As you can see, Apple TV functions as a traffic cop of sorts for your multimedia entertainment system. It enables a smooth flow of data from one device to another within a specific framework of rules that Apple designed.
Here's how the processes behind this system work.Let's imagine you want to play a new movie that you just downloaded to your iTunes library. The computer loaded with iTunes, your movie is in a second-floor home office and the Apple TV is connected to an HDTV in the basement entertainment room. A wireless router lets the Apple TV communicate with your office computer. To begin, you use the included remote control to interact with Apple TV menus displayed on your HDTV; you pick the movie option.
Your input goes to Apple TV's module controller software, which is the linchpin application that coordinates most of Apple TV's input/output capabilities. This application recognizes components as they are added or removed from your Apple TV network. What's more, it knows if you're using a regular infrared remote or the Remote application on an iPhone or iPod. In the latter case it recognizes that you need menus and icons formatted properly for your device's smaller screen.
Each component in your Apple TV network has its own subset of software that helps it communicate with the module controller. The module controller directs your request to the appropriate component in your network. In this case, it's your office computer, where the movie is cataloged in your iTunes library.
Your computer's software receives the movie request and forwards the movie data back to the module controller. The controller helps display a menu option on your HDTV that in turn lets you start the movie. Select Play and your computer begins streaming the movie through your wireless network to your TV, all thanks to the direction of the module controller.
In summary, the module controller software is the workhorse application that makes your Apple TV go. It keeps track of components connected to your local network, directs all of the vital commands you input, and controls each item that's displayed on the menus you see. And because data is filtered through Apple TV's software and processor, Apple can pick and choose the kind of file formats that work with Apple TV -- a key concept that irks some users, as you'll soon see.