I want to have just the shows I want to see available on whatever normal release schedule the studio has, commercial free, on any device I own in the optimal resolution. I want them to still be available if I miss several shows. To that point it is all similar to what Apple provides on Apple TV. The kicker is that I want all of that without paying per show. I don't mind paying per month. Once I watch a show I don't need to watch it again so I have no desire to own them. The price does need to compare reasonably to current cable pricing (and yes I realize the advertising subsidy is part if that).
What frustrates me about Apple's offering is the high price per show vs subscription.
What frustrates me about online viewing is that older episodes disappear or the viewer is awful with odd forced ads that sometimes mess up the playback.
What frustrates me about on-deman viewing via my cable company is the poor UI and lock-in to my cable box.
So yes there is plenty of room there to fix TV.