> Netflix has very little that would be playing currently on most cable channels people pay to watch
At one time, Netflix digital content was full of grade A movies instead of the mix of A, B, and C movies it has now.
Then the MPAA wised up and learned from the RIAA's deal with Apple's iTunes and decided they didn't want to cede content distribution to a single mammoth provider ultimately ending up with DRM-free music sales.
Netflix tried to split DVD and digital into two companies (Netflix and Qwikster) to allow them to bargain better with the studios, but the split failed and Netflix ultimately caved to MPAA demands to delay new releases on DVD in exchange for discounted DVD prices and the opportunity to be allowed to negotiate for streaming rights. (Notable competitor Redbox has not agreed to this release window and just pays retail price for new release DVDs.)
The studios renegotiated their contracts to make digital content prohibitively expensive for Netflix.
This is why there are so many web sites with competing catalogs and no one place to easily watch anything you want. Hulu, Vudu (Wal-Mart), Amazon, Netflix, Crunchyroll, Funimation, Daisuki, iTunes, Crackle, Google Play, etc.
Some sites have tried to catalog into an easily searchable interface:
But still, there are some shows that are just not available anywhere (e.g. Rawhide tv western with Clint Eastwood).
tldr: Netflix would compete with cable television if it could.