I'm dropping cable in a couple of weeks for an entirely computer based system (well, mostly - but I doubt I'll use the 360 much for movies once the TV is connected to a computer.)
I picked up a MacMini and upgraded the RAM (RAM is CHEAP right now) and use an external hard drive with it.
Using Plex (as PilotBob suggested) I access Netflix (2 movies at a time setup but mainly for instant streaming), Hulu, Daily Show, CNN, MSNBC, Colbert Report, a bit of Food Network (no Good Eats, regretably) plus anything else I might have stored on the computer (I tried backing up all my DVDs but it got too time consuming). I then have the MacMini also working as a streaming computer so I can access my music collection anywhere, or watch things on my laptop as well (I watch stuff when I go to bed mostly). Sometimes I'll rent a movie from iTunes or buy a TV show. I generally avoid buying video files however, since the DRM is an issue (not going to pay the same price for something I can't watch on other things, etc)
I've not turned REAL TV on in months, even though I'm still paying for it (roommate uses it) - it's been great. I don't watch a ton but this gives me what I DO watch.
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