Cables do not make much of a difference over a shorter length. However, in the case of component cables, the TV converts analog to digital, whereas with an HDMI cable, the signal is already in a digital format.
Besides the obvious quality reasons, the main reason that you should use an HDMI cable is that this cable is designed to transmit HDCP signals, something that other component cables don’t. If you like watching cable or Sky TV in high-definition, an HDMI cable is a must.
The difference between a top end component cable and an HDMI cable is negligible. However there is a huge difference in the quality of a traditional RCA cable and an HDMI cable.
Component and HDMI
How do you compare between component video and an HDMI cable? Which is the better of the two?
An analog signal is transferred via a component cable. An HDMI cable uses digital signals. HDMI cables have the following advantage over component cables. As long as the data is sent out correctly, you do not have to worry about the quality of the image transferred. Signals from component cables can vary in quality, the longer the cable gets.
HDMI cables are not very expensive, but may cost a fraction more than component cables. A cheap cable might give you results if the length is short, however HDMI shines when the length increases. This does not mean that component cables are bad. HDMI cables are just better because you do not have to worry about the image getting affected because of external reasons during the signal transfer.