If you're paying Time Warner Cable $25 a month for HBO, Time Warner is keeping $13 of that. Thus does Time Warner have a disincentive to let you get HBO any way other than Time Warner Cable. And, should HBO upset Time Warner Cable, they've lost their primary outlet for getting their content to you. Netflix gets to keep it all.

| If there is better content on Netflix, obviously everyone is going to jump ship from cable.|

Yes, precisely. But right now, the cable companies get to charge you through the nose for bandwidth you aren't using - I mean, you've got 300 channels but you can only watch one of them at a time. They're making money hand over fist. There was a time when I was looking at becoming a cable TV company and instaling in nursing homes and the like. I'm certified by Blonder Tongue. I know cable plants. And while 1 seat of HBO costs $39 a month, 100 seats of HBO cost closer to $390 a month. It gets extraordinarily fucking lucrative to be a cable company very, very quickly.

This is why everyone is scared shitless by Google Fiber - they're going to suck all the profit out of the entire sector for everyone. Great for consumers, shitty for the industry. Now, granted - it's an industry that deserves to die. But they are facing an existential crisis, and they are closer in demeanor to a wounded mastodon than a geriatric old man quietly sipping his morphine.

'cuz for now, if you've got Netflix, you've got cable. Period. That shit don't work over DSL and everybody with a phat enough pipe to sell you broadband is also selling you channels.