The original reply was completely useless unless you can translate Apple marketingspeak (it will change your life into an HD iExperience = it outputs up to 1080p) into real features. And since there might be other people that show up here via Google search looking for quick answers (like me), I'll try to expand a bit.
From the Apple TV User's Guide (as most user's guides are avaiable online now, to really get a feel for a produce before you invest, you should give that a quick glance):
With Apple TV, you can rent high-definition movies, purchase TV shows, watch streaming content from Netflix, and enjoy podcasts, YouTube and Vimeo videos, and Internet radio. And, you can stream your personal iTunes content wirelessly from a Mac or PC, and view photos from your computer or Flickr on your widescreen HDTV, from the comfort of your couch. And with AirPlay, you can wirelessly stream videos, music, and photos from your iPhone, iPad, and iPod touch to Apple TV.
A little more here: http://www.apple.com/appletv/what-is/ and here: http://www.apple.com/appletv/specs/
As I haven't yet bought one, I can't give any firsthand recommendations or knowledge.