Essentially, you are paying for the few channels that you actually want and the hundred of other channels are being provided for free. It's a win because you get free channels even if you don't watch them.

The thing is that there is essentially zero cost to providing channels to you that you are not watching. There are costs to sending the signals to your house but that doesn't increase based on how many channels you have access to. There also costs to producing content, but those costs are independent of the number of viewers. Add to that the fact these channels typically have advertising which is a good chunk of revenue, they aren't paid for by your cable service fees.

The result is that the costs involved don't correspond simply a cost per user per available channel. Consequently, it doesn't make sense to charge users that way.