Comment The economics strongly favour pay per view. (Score 1) 316
Television advertisements sell for about 2.5 cents per impression, and there are about 40 impression slots available in a one-hour show. Each airing of a show makes about a dollar per viewer in advertising revenue.
An episode on iTunes (admittedly not the cheapest way to watch tv on demand) is about two to four bucks, of which Apple keeps some - maybe around 30%. That means the content producer walks away with somewhere between $1.40 and $2.80 per viewer. More than for ad-supported shows!
As a viewer, I have to figure out what twenty minutes is worth to me. It's not easy, but for most people an hour is worth at least $15, which makes 20 minutes worth five bucks. Even at the prices iTunes charges, it's more attractive than watching ads.
At ten bucks a month, Netflix is a steal. Part of their catalogue is reruns, but part of what I watched on cable/broadcast was reruns as well. I do not think I save 160-odd hours a year. Maybe some people do though. Paying a dollar or two per hour saved is a tremendous bargain.