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Seems to me that even if a lot of Americans went the iTunes route, they'd still need a relatively fat pipe to download/stream this content, right? So they'd probably still be in bed with their cable company, they just wouldn't be buying TV from them. Fiber doesn't count. Fiber is a pipe dream for most people in the US.
*GASP*
A TV! watching shows/movies on a computer screen is nice, but it's not really practical with more than one or two people
I don't think it would kill cable very quickly, if at all.
Anyway, I'd just slap a cable to my TV for this.