There's a revolution afoot.
I have been using the BitTorrent client "µtorrent" for a few weeks now, primarily to snag episodes of Battlestar Galactica. The way BT clients work is, you install the client (in µT's case it's literally only a few hundred kilobytes in size - lean, and fast). To download a given video, you search for .torrent files on the web (there are BT-specific search engines like Mininova and The Pirate Bay). The .torrent file is typically only a few dozen kilobytes, and when loaded into the client starts to download pieces of the much larger video file (typically a few hundred MB) from other connected peers.
BT is revolutionizing television. Dean already pointed to a landmark article about how BT downloading is thought to be increasing Galactica viewership, and obsoleting the old revenue model of interstitial commercials. But the same dynamic can apply to movies as well as TV - for example, consider Japanese anime. Steven recently mentioned to me that he was waiting for the second volume of Bottle Fairy; looking on IsoHunt there are torrents for the first 13 episodes already posted online. If you upload torrents and make your own copies of movies available to others via the BT system, you can even earn preferential downloading priveleges at BT communities like PBNova. The BT system makes it easy to share your content and thus help raise the tide towards near universal availability of anything and everything out there that is worth watching.
But BT is not the whole story, either. There are also sites like the US-based iFilm and the Korean PandoraTV which allow you to search and browse through various video shorts and (in the latter case) even full length movies. The movies play in real-time stream mode rather than being downloaded to your computer, for instant enjoyment. Google Video has been trying to replicate this model, and while their interface has some interesting functionality, they are still way behind on the content side.
What's even more interesting are tools aimed at distribution of privately-made video. The best of these is YouTube, which is like a Flickr for video clips rather than photos. I've uploaded videos of my own to YouTube from my trip to Kyoto in 2004, here's an example.
Anyone with a digital camera that takes video clips (and most do, nowadays) can use this for free.
You might argue that the handheld video hardware market is also important; I remain unconvinced since toys like the video iPod are still expensive, and suffer from small screens and limited storage. I used my laptop to watch episodes of Galactica while traveling to Cleveland this week; nothing beats a laptop for true video enjoyment (and you don't need to break the bank, either).
But overall, we certainly are not limited to our TV sets and the broadcast schedule anymore for enjoyment of video, be it TV or movies. These new tools and communities are really rewriting the rules.