Packed in a minute -- 3.9 inch by 3.9 inch by 0.9 inch -- black hockey puck-esq case, the Apple TV (Second Generation/Late 2010/Black) was designed to make it easy to rent movies and TV shows from Apple as well as stream movies, shows, photos and other content from a Mac, PC, iPod, iPhone or iPad all at 720p and 30 FPS (it does not support 1080p). It has built-in support for Netflix, YouTube, Flickr and MobileMe streaming as well.
In a significant departure from the original Apple TV, the second generation model was made for streaming and rentals alone -- there is no advertised internal storage and no option to buy content -- but it did not require a Mac or PC for "tethering" either.
It is powered by an Apple A4 processor and runs a variant of the iOS that powers the iPhone, iPod touch and iPad models, although it does not formally run the iOS and cannot run iOS applications either. It cannot be updated beyond Apple TV Software Update 6.2.1.
Connectivity includes HDMI, optical audio, 10/100Base-T Ethernet, and a single Micro-USB port "for service and diagnostics" -- and hacking, no doubt -- as well as 802.11a/b/g/n wireless networking.