The Convergence Consulting Group is in their sixth year of studying the habits of that not-at-all-rare beast: the American couch potato. The group just released two new reports focusing on on the online viewing habits of U.S. and Canadian consumers, and the battle of the triple play between cable and telcos. The general gist? Alternative video delivery outfits (Xbox 360, Vuze, AppleTV) aren't remotely ready to run with the big dogs, and cable VoIP continues to take off at a faster pace than TelcoTV.

We spoke to Convergence analysts, who tell us cable operators now control more than 80% of the VoIP market, and will provide phone service to 19% of the nation's phone customers by the end of this year. The phone companies, in part due to the broader effort of building out TV infrastructure, will only have 4% of all paying TV customers by the time 2009 begins (in contrast to 2% last year).

Convergence tells us the RBOCs lost 8% of their residential phone customers in 2007, and will lose the same percentage in 2008. We've previously noted that AT&T, Verizon, Qwest and Embarq are collectively losing roughly 2.6 million landline customers per quarter, with a large chunk of those users heading for cable VoIP or going cell only.

Cable operators have started to see some impact from telcoTV, but the impact isn't terrifying operators just yet. Cable lost just 1% of their customer base in 2007, and Convergence says satellite operators won't lose market share until 2010. Cable operators are winning the triple play race, and continue to add more residential broadband customers per year than the baby bells. The group confirms the obvious slowdown in total residential broadband user additions, noting there were a million fewer new customers added in 2007 than in 2006.

As for broadband-based competition to traditional TV models, the group calls bypassing entrenched players and selling direct to customers "an economic dead end." That's not to say that online video isn't growing, but the majority of viewing is of short clips, and only 2% of TV ad revenue was from online sources. There is growth in online film & TV viewing, and Convergence analyst Bram Eiley tells us they think Apple will be the online download rental leader within 18 months. But compare Apple to the major broadcast industry:Most films come to Apple 30 days after brick and mortar and mail rental outfits have them. iTunes/AppleTV limitations also annoy many users. Meanwhile, other options like the Xbox 360 have seen some success, but there's only 9 million 360's in the market as of the end of 2007. Whether we're talking rental or sales, the reach, film selection and feature set just isn't there yet to do major damage to traditional delivery.

Online represented 2% of US Movie/TV sales in 2007 and we forecast 3% for 2010. -Convergence Consulting

"Selection is a problem, ease of use 'can' be a problem but thats not the main issue, and we don't think download time is a big issue either," says Eiley. "What we are saying is that on the rental side is that mail, kiosk, store and cable VOD are all major competitors to online...on the sales side it's mainly that you can't buy most new movies through Apple." The market share breakdown illustrates the chasm between hype and reality:What about established broadcasters pushing whole-heartedly into the online distribution arena? "There is no current economic rationale for Broadcasters & Cable Networks to abandon traditional TV or attempt to accelerate a transition to a total online model," says the group. "To do so would put $66 billion in traditional TV advertising revenue and $30 billion in cable, satellite, telco TV provider programming fees at risk."

Though the numbers illustrate that the death of traditional TV will be slow in coming, growth in online video advertising should be strong. Convergence says that Broadcaster, local station and cable networks made $1.4 billion (2% of total ad income) in 2007, a number that should grow to $6.4 billion (8%) in 2011. Convergence also estimates that while 9% of their user bases watched full TV episodes online in 2007 (6% in 2006), 14% will in 2008, 19% in 2009, and 23% for 2010.

One thing not studied is the impact piracy is having on all of these business models. It's again here the elephant in the room, something we've noticed previously when eyeballing industry, blog, and media analysis of TV trends. That's an oversight, given that all of these companies are competing with piracy for user attention. Eiley tells us they may include piracy in future reports.