Producing a "show" or a "movie" requires a teeny, tiny amount of effort and resources these days, and can be done without spending more than 4 figures on equipment and whatnot.
Though it must be said that the only way you can produce a movie really cheaply is if you can persuade folks to work for peanuts in the hope of breaking into the industry.
But if low-budget stuff becomes the industry, then the supply of folks willing to work for nothing in the hopes of being the next George Clooney will die up when George Clooney starts taking home five hundred bucks a film.
As far as low-budget productions, I think you're looking at it from the wrong perspective. The key is lowering the cost of entry. What this enables is not just "low-budget" productions but also "start-ups" with members who have decided to defer compensation in exchange for equity in the "start-up". This is the dominant way that bands get started, for example.
There is already a lot of pretty high quality original content on youtube. Some of that content is more popular than some cable content. There are youtube channels which have weekly updates and see millions of viewers on every episode. They are under the traditional media radar though since they don't have a promotional budget and they don't appear in a program lineup anywhere.
This trend can only accelerate from here. Producing a "show" or a "movie" requires a teeny, tiny amount of effort and resources these days, and can be done without spending more than 4 figures on equipment and whatnot.
We are nearing an inflection point in this process, soon there will be a critical mass of shows and viewers such that word-of-mouth recommendations start exploding viewership and more importantly that it begins to become cemented in the zeitgeist that making an "internet tv show" is a perfectly acceptable thing to do, regardless of how talented you are, and more so is a quite feasible thing to do. That will lead to a spiraling increase in both content and viewership which will likely catch a lot of the traditional media folks off guard. I don't think they realize that there is a bubbling cauldron out there which is poised to spew forth the equivalent of hundreds of channels of content. Content that people will watch. And talk about. And value at the same level as traditional TV content.