Yep, you will need an Apple TV to stream video content by Airplay. You are quite restricted to what content video you can stream to an ATV, but installing XMP or Firecore will allow it to play pretty much anything. Bare in mind the ATV3 can't yet be jailbroken, and Firecore haven't finished their version of the software either.
If you are a Mac user, Mountain Lion will negate the need for this anyway as it will enable Airplay Screen sharing, so you can stream your monitors contents to the ATV.