So Reign with a 0.6 on a secondary network is (likely) more or less profitable (which is an indicator, given that it is probably more expensive than other scripted dramas give that it is historical fiction). How can you justify cancelling cheaper shows with 1.0 or 2.0 (on other networks)?
I get it that you'd want to have the highest rated show and that there is a limited number of time slots and that novetly shows are more likely to achieve higher ratings (if only because there hasn't been atrition, people can start watching because they don't have to catch up with prior season), so you have to be careful, but the pilot/aborted series model currently in use is far too wasteful.
A better strategy to increase retention of shows seems in order: stop cancelling shows after a couple airings (Chaos, Back in the Game, etc.) w/o enough info on real performance (ie, missing out on cult shows like Firefly), just to make room next season for the next crop of shows that will mostly fail (maybe have fewer new shows, and increase retention on existing shows). If only because it is not working, they're hemorraging viewers to alternative media, and they keep cancelling shows that could develop a following if allowed to grow a little - specially when they get cancelled due to factors outside their control (like the writer's strike or changing schedules). Not to mention that the networks air reruns for half the year in an outmoded farming calendar.
Or they could just try and increase quality and have new progamming year round. Stop trying to extend shows beyond all credutilty (ie, jump the shark season after season) and just tell compelling stories in a small number of seasons: give viewers some reasurance that they'll get closure.
Eyeballs is the product, and changing demographics are making it a dwindling resouce. But (like other comodities), advertisement prices aren't going up because of artificial competition, and the networks don't seem to be trying anything intelligent to try and hold on to the eyeballs they currently have.
They want every show to have a 4.0+ share, so every show has to be sanitized and tweaked to appeal to the broadest viewership possible, but with so many options, people won't keep watching because of all the dilluted content (that interest their specific demographic).
It's like SyFy, it is supposed to be a network about a subculture, a targeted demographic, but they kept trying to cross network boundaries (ie, air shows on USA and other networks of the same conglomerate), and in the end, kept trying to appeal to other demographics and kept alienating its base to the point that it can barely be considered science fiction, and most original programming simply faded away, and with it, most of the science fiction community (so SyFy is just one more of 100 channels nobody watches but for an hour or so a week).