J.J. Zhang is a chemical engineer and amateur financial adviser who was the winner in MarketWatch’s second annual World’s Next Great Investing Columnist contest. He runs the blog MarketTech Reports. You can follow him on Twitter @MarketTechRpts.

In the future, historians will look back and recognize the impact the creation of the Internet had on our society and history. The virtually unlimited sharing and availability of information has already started to revolutionize the world in many ways, making some industries obsolete and changing several others in its wake.

One historical comparison is how refrigeration changed the world. Unfathomable today, before refrigerators food spoiling was a major problem, and entire industries were created to cut ice during winters and R&D done on how to insulate warehouses and shipments. In 1909 there were more than 2,000 commercial ice plants in America with over 15 million tons of ice consumed per year. But those industries eventually disappeared.

The Internet mirrors that transformation for today’s industries. Wikipedia, as an example, has eliminated the encyclopedia-publishing industry. Another Internet-driven trend that is likely keeping industry executives awake at night is the dumping of pay TV and cable in favor of Internet media, termed cord-cutting or cord-nevers, a phenomenon all too familiar to newspapers and telephone companies.

The trends

While much has been made of cord-cutting as a trend, how many people are doing it? According to a recent Deloitte survey, 8% of Americans are or are considering canceling their paid television service and 12% don’t have paid television at all. However, recent TV subscriber numbers have been fairly stable.

While estimates vary, compilation of subscriber data for 2012 from the major satellite TV, telecom and cable companies show a slight gain in the 200,000 to 500,000 range, a small percentage of the 100 million plus base, but not a drop. However, almost all companies showed a slowdown in the growth of subscribers.

This is not isolated to the U.S. trend either, according to research firm Informa Western Europe suffered its first pay-TV subscriber decline ever last year.

However, the true impact is in the near future — the next generation of TV watchers. Among leading millennials, many of whom are now setting up new households, only 46% subscribe to pay TV. Land-line subscription fares even worse at only 30%. Those same millennials used smartphones and tablets as their TV at only 2% and 5% in 2011 but that figured jumped to 20% and 25% for 2012, a substantial change.

The decline in land-line telephone over the last decade is likely going to be mirrored in pay TV. According to a 2012 CDC report, over 55% of Americans age 25-34 don’t have land lines. Looking at the decline rate, the percentage of US households that were wireless phone only jumped from 20% in 2008 to over 35% in 2012. A similar result in pay-TV penetration will significantly reduce revenue and profits.

Additionally, pay TV is facing competition or pressure from almost all technological corners. A recent ruling in WNET v. Aereo, a start-up that streams local broadcast TV over the internet, upheld Aereo’s business model. Though broadcast is not specifically pay TV, the service does provide an alternative for a large block of channels and programs, not to mention undermining the $3 billion market for broadcast retransmission fees.

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Online video delivery services are proliferating at a rapid pace as well. Netflix is the 800 pound gorilla and accounts for a large part of Internet video consumption, so much so that it’s now responsible for almost one-third of peak Internet traffic in North America.

Beyond Netflix, there’s also Hulu, Youtube, Amazon Prime, iTunes video, Google Play video and a large number of lesser known sources. Every eyeball on those services is one less on a TV. Netflix’s recent experiments in creating original shows have also driven awareness of fresh content for the TV-less.

Additionally, new social trends such as binge watching rely heavily on features like video-on-demand that many pay-TV services lack or charge extra for. Increasing prevalence of smartphones and tablets, combined with new, faster wireless networks like LTE and new data-heavy plans, provide viable alternatives to traditional couch surfing.

TV fights back

As expected, the pay-TV industry is aware of the trend and is fighting back. One strategy, employed by Comcast CMCSA, -2.62% , is to dominate the entire ecosystem by being a cable operator, Internet service provider and mass media such as NBC all in one. By controlling what gets to the home, and where exclusive content can go, not to mention capping your monthly Internet usage for alternatives, they’ve managed to slow the trend.

Exclusive partnerships, especially with live sport channels such as ESPN DIS, -1.41% , have also been instrumental. The demand for live sports has been consistently rated as the No. 1 reason people keep pay TV. Though some live sport streaming is available, it is limited. Until those exclusives and partnerships change, sports will be cable’s life line.

The biggest battle, however, is likely in the courts. Streaming start-ups such as Aereo, defunct sites such as the TVShack and its legal fight, and other initiatives such as Net Neutrality or even Google Fiber, all constantly work to chip away at the traditional pay-TV paradigm while traditional media companies attempt to preserve the status quo.

Winners and losers

While pay-TV subscriber numbers have yet to show the drastic declines that land lines are seeing, technological, cultural and social trends are all pointing in a similar direction. The pay-TV industry has taken note of it and is transforming itself to become less dependent on the old system, gain more control of the ecosystem and fight tooth and nail to slow down the inevitable future.

Such a race will undoubtedly be filled with winners and losers as the story unfolds.