Apple TV - what will it be? what won't it be?

Almost every analyst is expecting Apple to get into the TV business either late 2013 or sometime in 2014. Tim Cook even said in his Rock center interview a couple of months ago that he has intense interest in the TV. While the current form of the Apple TV has done ok in terms of sales, it hasn't caught on the way the ipod caught on for music listening or the iPhone has for smartphones. I don't have secret insight into Apple's R&D center but here are some reasons why I don't think Apple will be coming out with their own TV set.

1. Cost prohibitive: how much would a 50inch apple tv cost? I'm guessing in the ballpark of $1200-1500. While people usually pay a premium for apple products, i can't imagine many ppl spending that much more when you can go out and buy a 50inch set for ~$700-800 these days.

2. Difficult to keep inventory in stores: A TV is huge compared to an iphone/iPad/laptop. How many TVs can apple possibly stock in their stores? It's just not practical for them.

3. All new innovative UI won't do any good for cable subscribers: Some analysts say Apple will innovate on the user interface of the TV. While that's all well and good, most cable companies require a cable box to get full use of their products (channel guide, dvr, on demand). Plus they charge customers a monthly fee to rent the cable box. An awesome Apple UI on their tv would do no good for ppl who have to access their tv content through a cable box. Either apple will have to pay cable companies to let customers bypass the cable box or they will have to get into the tv content business themselves.

Another theory is Apple get all the content owners to make their content available through itunes through a subscription or pay-per-view model. This is more likely but there are so many other ways to do this that it's hard to see how apple will truly innovate in this way.

What are your expectations for the elusive Apple TV?