Tech companies’ vision of transforming the television set into yet another device that streams content from the Internet may finally be becoming a reality. The NPD Group on Wednesday reported that televisions are now the “primary screen for viewing paid and free video streamed from the Web,” beating out personal computers for the first time. According to NPD’s latest survey, 45% of American consumers are using the television as their primary screen for watching online video content, while just 31% of consumers said they primarily used their PCs to watch online content.

These numbers are an almost perfect reversal from a year ago when NPD found that 48% of American consumers primarily used PCs for online videos while just 33% used televisions. Netflix (NFLX) is unsurprisingly the most popular application that’s driving users to watch more online video on their televisions, with NPD reporting that “of those watching online video on the TV, 40 percent use their connected TVs to stream video via Netflix, 12 percent access HuluPlus, and 4 percent connect to Vudu.”

NPD’s full press release follows below.

NPD Group: TVs Overtake PCs as the Primary Screen for Home Viewing of Online Video PORT WASHINGTON, NEW YORK, September 26, 2012 – According to The NPD Group, a leading market research company, over the past year, the number of consumers reporting that the TV is their primary screen for viewing paid and free video streamed from the Web has risen from 33 percent to 45 percent. During the same period, consumers who used a PC as the primary screen for viewing over-the-top (OTT) streamed-video content declined from 48 percent to 31 percent. This shift not only reflects a strong consumer preference for watching TV and movies on big screen TVs, but also coincides with the rapid adoption of Internet-connectible TVs. NPD’s recent “Digital Video Outlook” report reveals that home installation of millions of Internet-connected TVs is changing the way that consumers access and view streaming video. As of the second quarter (Q2) of 2012, 12 percent of the installed base of consumer TVs in the U.S. were connected TVs, totaling more than 29 million devices. Approximately 10 percent of U.S. consumer households currently own at least one connected TV. NPD research conducted over the past year has found that 43 percent of connected TV users accessed online entertainment directly from their TVs, including online video, music, and cloud services. “The growth in connected TVs is another sign that online video is maturing,” said Russ Crupnick, senior vice president of industry analysis for The NPD Group. “Streaming video has moved from the dorm room to the living room; and, as more households obtain and connect TVs to the Web, we predict increased trial and engagement for video distribution services.” Netflix Watch Instantly is the dominant application for Web-to-TV video. Of those viewing online video on the TV, 40 percent use their connected TVs to stream video via Netflix, 12 percent access HuluPlus, and 4 percent connect to Vudu. Connected TVs, which offer direct access to these and other popular online video services via TV apps, represent a convenient alternative to PCs, or the use of other Internet-connected peripheral devices. NPD’s study also found that nearly one in five connected-TV installations resulted in consumers no longer using peripheral devices, such as streaming media players, video game consoles, and Blu-ray Disc players, to access streaming video on the TV. This decline in usage could impact the usage models and utility of peripheral devices. Data note: NPD’s “Digital Video Outlook” report is based on data collected from multiple sources, including two electronic surveys. The quarterly survey includes approximately 1,200 U.S. broadband households. Survey data was weighted to represent U.S. population (age 13 and older) and tested for statistical significance at the 95 percent confidence level. The semi-annual survey includes approximately 10,000 respondents. Data from this survey has a 97% level of confidence, with a +/- 0.7% margin of error.