With Airplay from iCloud lets you "use your iOS device to play videos from iTunes in the Cloud," meaning that the streaming will go right to the Apple TV device rather than the iOS device. However, Apple TV takes reportedly a long time to buffer ahead before playing from the Cloud, so the feature is not enabled in the update by default.
In contrast, streaming to iOS device begins almost immediately, though AirPlay from iCloud is for iOS 7 devices only.
The update also brings support for the iTunes Music Store, and replaces Photo Stream with iCloud Photos and Videos.
The Apple TV update also supports iTunes Radio.
Written by: James Delahunty @ 22 Sep 2013 17:47