You make some good points but I have a few questions.
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Originally Posted by After Shock Media
In my mind the industry only needs 4 areas to survive and 1 of those are optional.
1. Traffic.
2. Content.
3. Way to bill/monetize.
4. B2B solutions.
Notice no affiliates? Sure some may still exist in number 1. Affiliates have been loosing traffic now for some time. Beyond that many are using sponsor resources to generate it in the first place. Sponsors themselves are also producing more and more of their own traffic. It comes from the same pool.
Only large difference is now we have tube sites hoarding all the traffic. Sure they are using porn content to sell webcam, dating, misc., and some adult sites - they fill the role of number 1 just fine. Only issue they currently have is that they are perceived to be illegal due to content theft. In same token many tell others that they must evolve, well can I ask what happens when the tube site also evolves. The next obvious step for them is legal content. When they evolve to this it would fill all 3 major requirements. They either could self produce or end up going B2B and having others shoot content for them.
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I wonder how long will cams and dating sustain the tube model? You would have to assume that most of the tube traffic is garbage. Most of these are freeloaders, bookmarker types who aren't going to buy anything. Those that may buy stuff will, but eventually seeing the same old ads over and over again for the same products will kill the ratios. When that happens they have nothing to fall back on. They can't sell paysite joins because who would join a paysite when the tube probably has more free content on it then the paysite has? The reasons they have so much traffic is that they are free. The day the tubes start to charge to view them their traffic will spiral down so they could evolve into a paysite of sorts, but then they are going to be in the same boat every other paysite is in.
Legal style tubes with smaller clips could potentially sell paysite joins, but then that is essentially a MGP with the movies right on it so it is nothing groundbreaking and in the end the model will end up looking like the TGP and MGP model. There are a few very big very successful sites and a ton of smaller less successful sites out there.
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In the event that they do indeed end up producing and buying content. Who is left to complain in the industry? Content producers would have a job, money could be made, and customer needs are met. Only people that could/would be left out in the cold would be affiliates. Now very well that the tube sites or whatever incarnation could end up paying affiliates money for whatever traffic you could send them, it would not be a requirement.
This does not necessarily mean the death of all niched or small site owners either. They know their content and customer demands so they will always have some sort of base to sell to, even if hired by others etc. I do know that many of these types of sites are not that affiliate dependant at all right now anyways.
My long term  of a possibility.
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The last I read most of the big tube sites were not making that much money and were for sale. I think something drastic would have to happen for them to be able to afford to shoot their own exclusive content, but then, like you say, they may need affiliates to help them get traffic.
Building traffic and sales in house is a must for any program that wants to be successful, but still affiliates are a great way to get extra joins, often time many extra joins that you couldn't afford to get building just in house.
Things will change and evolve, they always do. But I think the affiliate is going to be around for a long time to come.