“Prediction,” goes an old Danish proverb, “is hazardous, especially about the future.”
This sentiment has been attributed to a number of people, among them, Niels Bohr, the Nobel laureate in Physics and father of the atomic model.
Predictions that rely on trends to continue indefinitely often run into comical results. For example, I was watching a presentation regarding cell phone sales at a time when these phones were the bricks seen in the original Wall Street movie. Exponential growth out indefinitely. I raised my hand and pointed out that growth of new technology has to be asymptotic to population growth. Any model that suggests say 50 billion phones will be sold each year to a population of 10 billion people makes no sense. You see my point.
On the internet, especially social media, anyone can say anything. This is true of books as well. Just because it's in writing doesn't make it true. A search on how much of investing is indexed results in about 16%. If the source isn't reputable enough, a dozen results were in a tight range around that number. (Ad hominem attack alert) When an author's conclusion is based on such an incorrect premise (50-70%?) I'm not likely to continue reading. As I get older, my own time is too valuable.
If I were writing my own article, I'd suggest 15-20% as a reasonable range. Considering that Jack Bogle devised the index fund in 1975, nearly 50 years ago, I'd say that we are quite far from a time when the phenomenon your author suggests is likely to happen. We still have 6,680 actively managed mutual funds along with all the investors who buy individual stocks.
One last thought - The 10-year average return for large cap stock funds (active management) ending 2012 was 14.96% vs the S&P 16.58%. After fees, I get 16.56%. More than a 1.5% difference. Justin gave an excellent answer to the hypothetical "what if everyone indexed?" but the fact is simple. We are not on a path where I'd concern myself with this.