I think the reality is somewhere in between the excitable article and the downbeat comment; being able to shoot more cheaply is nice and all, but still does not mean indie filmmakers will be any more welcomed into theaters (many of which still require prints anyway).
Much more interesting than the improvements in price/quality of digital filmmaking is the possibilites of film distribution on the net. It isn't happening as quickly as I'd hoped, but as bandwidth gets cheaper and faster, and televisions get more connected to the net, I'm expecting the film industry to change quite dramatically. The emergence of cheap digital filmmaking and web-based distribution networks will be similar to the recent change in dynamic of web startups. And the longer the big studios avoid exploiting this model, the more chances it has to be seized by independent filmmakers (and startups ;).
It depends on the market, locally, the owner of a major theater chain has adopted digital projection on something like 35+ screens in the greater metro area and has really been open to some of the smaller indie films. Many times it takes a lot of vision on the part of the theatre owner/manager because indies can really depend on the "long tail" when it comes to theatre audiences. They don't have the money to advertise so you run the film for a week and hope those people tell their friends and they tell there friends and pretty soon you start to see some steady returns as the word gets out, but this takes some guts and patience from the owners.
Net distribution will be a great avenue as well, given how reticent the studios have been to band together and provide "one" place where people can go to rent/buy films online.
Much more interesting than the improvements in price/quality of digital filmmaking is the possibilites of film distribution on the net. It isn't happening as quickly as I'd hoped, but as bandwidth gets cheaper and faster, and televisions get more connected to the net, I'm expecting the film industry to change quite dramatically. The emergence of cheap digital filmmaking and web-based distribution networks will be similar to the recent change in dynamic of web startups. And the longer the big studios avoid exploiting this model, the more chances it has to be seized by independent filmmakers (and startups ;).