Last night during his interview at All Things Digital, Steve Jobs told those in attendance that that Apple TV is still just a hobby, and remains so due to current market conditions.

According to Jobs, it’s difficult to penetrate the set top box market when cable providers already heavily subsidize hardware, giving “everybody a step top box for free, or for $10 per month. That pretty much squashes any opportunity for innovation, because nobody’s willing to buy a set top box.” Jobs said that he was of the opinion that adding additional devices to a user’s home theater detracted from the user’s experience, as with each new device comes a new remote and unique user interface.

“The only way that’s ever going to change, “is if you can really go back to square one,” Said Jobs. “Tear up the set top box, redesign it from scratch with a consistent UI across all these different functions, and get it to consumers in a way that they’re willing to pay for it. And right now there’s no way to do that.”

The shorthand of all this?

There’s no way to bring the Apple TV into households without causing at best, marginal aggrevation to consumers who are already overwhelmed by the number of devices and associated remotes. Because of this, The Apple TV will remain a hobby for Cupertino until a paradigm shift in service delivery can be leverage through innovation in how electronics producers think about content delivery and integrations.