Who's paying who for what?

In the Financial Times on 12/9/2010, an article about Netflix, and how it is competing with traditional television media delivery said this:

"Netflix is offering $50,000 - $100,000 to stream television shows...but traditional channels still pay "millions of dollars" per episode"

I guess a rough analogy would be, imagine if one company owned every mode of freight transportation in the country.  Further, imagine that they made an enormous amount of money off of the advertisements that they pasted on the sides of their trucks, trains, and ocean-going vessels (the latter of which encourage dolphins to buy HD TV's).  Finally, and I guess this is where I'm stretching the analogy to the breaking point, imagine that the revenue the shipping carrier receives is directly proportional to the desirability of the goods in the truck/train/boat.  So a truck carrying horse manure would get terrible returns on ad space, while a truck carrying, say, Cinnabons, or Filet Mignon, would get better returns.

Whereas, in the world we are familiar with, when we want to ship something, we pay the carrier (UPS, Fedex, etc), in this world of media distribution, it apparently works the other way around, since the "channels" (read: distribution network) actually pay the content creators.  The channels then presumably bid on the most desirable content such that they can charge the most for adjacent advertising, which is their real income stream.

I'm making all of this up off of one quote.  I'll ask around to see if I can confirm if this is how things really work.

But what does this mean about companies like Netflix? More on this later...