By Trefis.comNetflix ( NFLX) is a movie rental company that makes film and TV programming available to customers via mailed DVDs and online streaming, all for a fixed monthly subscription. In the expectation that online viewing will dominate the video market in future, Netflix is currently expanding its online catalog. On the other hand, cable providers like Comcast ( CMCSA) are fighting to keep their subscribers by building video-on-demand services to stem subscriber losses. Below we compare Netflix and Comcast in terms of their current offerings and strategic outlook. Our conclusion: While Netflix is currently in a strong position versus its cable competitors, the cable industry could benefit from inherent flaws in Netflix's subscription pricing model. What favors cable providers like Comcast? Content owners demand maximum profits Declining DVD sales and piracy are eating away potential revenues and profits for content owners, who must now find other ways to make money. One good example is Disney and Fox's battle with Dish Network over carriage fee increments. And several studios recently introduced a 28-day delay in making programming available for rental. Compared to rental distributors like Netflix, content owners can generally reap higher profits from cable providers, with their bulk carriage capacity and higher on-demand pricing. Comcast has good studio relationships and enormous buying power Comcast and other cable providers have been distributing video content over their networks for a very long time and have established strong ties with studios. They can use these relationships to acquire on-demand rights to more content. And Comcast has deep pockets. If it's willing to pay more for the video-on-demand content that it acquires, it might influence content owners to provide exclusive distribution rights, albeit for a short period of time. What favors Netflix? Netflix's pricing is much more attractive than Comcast's A Netflix subscription of $8.99 per month allows customers to rent one DVD at a time and gives them unlimited access to movie and TV downloads. If we assume that a typical customer watches two movies each weekend, the $8.99 plan yields an average cost of $1.12 per movie. On the other hand, Comcast charges $5 to $6 per movie for on-demand viewing of more recent releases. Many consumers seem willing to wait until the Comcast sell-through window passes to order the DVD version from Netflix. Although Comcast does offer some older movies for free, its catalogue is currently less rich than that of Netflix.