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Report claims "major" Apple TV update in the pipeline

Apple is planning a major upgrade of its slow-selling Apple TV set-top box as part of a new offensive to try to boost its share of the digital video download market, according to BusinessWeek.

However, the business publication offers no details of the initiative other than to say that the new hardware device should arrive around the same time Apple launches its iTunes movie rental service.

Conversing with American Technology Research analyst Shaw Wu, BusinessWeek speculates that one possibility is that Apple might add a TV tuner to the product later this year.

The remainder of the report recounts the hurdles Apple chief executive Steve Jobs has faced while trying to replicate his success in the music business over in the digital video download sector.

It notes that Disney and Fox have agreed to support the upcoming iTunes rental service, but have different terms for when movies will be made available.

Independent Lions Gate, on the other hand, may agree to let Apple rent its stuff, but not sell its newer releases, the report adds.

Sony and Universal —both fierce Apple rivals —are unlikely to back the initiative.