The ability to make bolder strategy choices is also hampered by the need to enter into distribution contracts with the above-mentioned providers.
If you do the math, I'd guess revenues would be higher doing what the entertainment industry currently does than what you propose. While this will lead many people into pirating, it's still likely a pretty small percentage.
Netflix did $8.8 billion in revenue last year. U.S. domestic box office receipts were around $11.3 billion and were around $30 billion globally.
In the US alone, given Netflix' current subscriber base of 49 million, it would cost each subscriber would have to pay a little over $19 per month extra just to make up for domestic box office revenues. When you factor in that Netflix needs to make some money on top of that, as well as whatever scaling is necessary, that number needs to go up even further. And then you need to makeup all the additional money that comes from rentals and distribution deals outside of Netflix. There is a reason why Netflix only gets a small portion of quality movies -- because companies can make more signing deals with companies other than Netflix.
Would most people be willing to pay over $100 per month for an all-you-can-eat movie service? I doubt it, considering that doesn't even account for all the television programming, which takes up a much larger portion of people's screen time than movies do. First-run television content earns a lot of revenue, as do live shows, particularly sports. ESPN alone costs cable companies $7 per subscriber and that's with lots of ad-supported content. Without ad support, that number would be closer to $12 and that doesn't account for the additional production costs to make up for all the additional airtime that needs filled.
I think to truly create an all-you-can-eat, comprehensive entertainment streaming service, you'd be look at several hundred dollars per month in subscription fees. And you'd still have to figure out some sort of way to incentivize content producers to continue producing the same level of content they currently do and support competition so there is a continued push towards higher quality.