I have the ATV3 and was SO excited about Qello that I paid for the year right away. I first tried it online, then my iPad with no issues. I couldn't wait to watch it on my ATV. Boy was I in for a disappointment! Playback usually starts out fine, but then switches to unwatchable quality in both audio and video. Then sometimes the audio will get better, but still not good, and sometimes so will the video. It's as if the servers cant handle the data output and auto adjusts the stream.
I can tell you that it's NOT my network. My ATV is hard wired to the network, and no other ATV app does this ever.
It's either the Qello app itself, or the Qello service. I suspect it's the app on the ATV device because I have no problems on my iPad or online.
I hope that the developers are aware of this, cuz it's very frustrating!!