It's at least interesting
Thinking from purely my own use, we currently subscribe to Blockbuster. For £8/month we get four Blu-Rays or DVDs. The downside to this is that we have to watch a DVD, post it back and wait for another to arrive. Also, if we don't get through our four films in the month, we still pay £8. If we get through all four too soon we either have to wait or pay extra (£2.50 I think) before they will send another. Also, for popular releases, you might have to wait a few weeks for a film to become available.
So the AppleTv looks quite interesting. I don't have to wait. I don't have to choose the film we will watch well in advance. There is no chance of scratched discs spoiling our viewing (a constant problem - particularly with old films or childrens stuff). And all for only about £2 a month more. Given that we often don't get through all our films it would probably break out about even.
However, it is only 720p. Why? Is this because they are worried that the bandwidth isn't really there in most homes to reliably stream 1080p? That would certainly be my worry. It's bloody annoying having a scratched disc. Imagine paying £100 for the box, buying your film, sitting down with your popcorn and the film stutters and pauses all the way through whilst the streaming tries to catch up with itself.
But, as I say, it is interesting and the prices look about right. As long as the content is there. I suppose if I bought one from Amazon I would be able to return it within 28 days for a full refund if the streaming didn't work or the picture was horribly compressed.