Image: Apple TV
Tony Avelar  /  AFP - Getty Images
Apple TV was first released in 2007.
updated 5/28/2010 1:11:58 PM ET 2010-05-28T17:11:58

Apple TV, which has been one of the company's most anemic products, may be in for a makeover that includes being based on the next version of the iPhone and using cloud-based storage for movies and TV shows.

The updated Apple TV could be announced June 7 by Apple CEO Steve Jobs, when he is expected to unveil the new iPhone.

The re-do would come not a moment too soon, as Apple goes against frenemy Google in the TV arena. The search giant announced last week it is partnering with Sony, Intel and Logitech to release "Smart TV" next fall. It will make Internet TV simpler and more appealing, the companies say.

Tech Web site Engadget said today that, "According to our sources, this project has been in the works long before Google announced its TV solution, and it ties much more closely into Apple's mobile offerings."

Apple TV, which costs $229, is a media receiver which lets users rent and buy movies and TV shows, then stream them to their TV sets, as well as play music through a home theater system.

The current version of Apple TV comes with a 160-gigabyte hard drive. The new version may have only 16 gigabytes of flash drive, and storage of movies, shows and music could be cloud-based, Engadget's source said. It might also have a much-lower cost: $99.

Apple TV has been around for three years, but has had nowhere the success of the company's other products, such as the iPhone, iPod and now, even iPad, just released in April.

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