About a month ago, I cancelled my Comcast premium service package which was, basically, the paid channels (HBO, SHO, Cinamax, etc.) including on-demand. My monthly bill dropped from $110 to $75. A $35 reduction.
I signed up for a Netflix account and I now watch movies, tv shows, and other streaming video content for $9 a month on my television via my TiVo (I could also use a PS3, Xbox 360, Wii, Roku, Apple TV, etc.).
$35 minus $9 is a $26 a month net savings and I find that there is more stuff to watch on Netflix than I have time for (I have a huge instant viewing queue) and I don't miss the premium cable channels at all.
Plus, I can watch on my notebook when I am travelling and I will be able to watch on my iPad which I expect to buy next year after they come out with version 2.
I am not saying that NFLX makes sense at its present P/E. I don't and I don't have any holdings long or short.
But as a service, I definitely prefer Netflix to cable as a way to watch movies and other on-demand content.
And what does the price of someone's entertainment system have to do with anything?
Netflix streams in HD. I have a 56 inch HD set and the Netflix content looks and sounds good to me.