In fact, speaking at the Nomura 2nd Annual U.S. Media & Telecom Summit in New York, Sarandos stopped just short of saying that Netflix’s four-year, $1 billion deal with the CW’s parents, Time Warner and CBS Corp, has saved the broadcast network from extinction.

“What’s important to note is that you look at programming at CW, Netflix license fees makes that content profitable,” he said. “Without it, it was struggling along.”

Did Netflix really save an entire broadcast network? Well, based on the just-released dire ratings data for CW from last season, the jury is still out on that. But as the network seeks to stabilize its linear TV ratings situation as it transitions itself into broadcast TV’s first true multi-platform programming institution, those Netflix dollars — as well as revenue culled from a separate streaming deal with Hulu Plus  — are proving pivotal.

Broadcast TV’s most innovative model

The CW targets a much narrower audience than the Big Four networks (ABC, CBS, Fox and NBC), primarily going after young women 18-34 with shows like Vampire Diaries and Heart of Dixie. But while its scale is much smaller, the network presents a very forward looking model for the television industry.

Simply put, CW’s audience is migrating to digital platforms at a faster rate than viewership for the Big Four networks. And CW is innovating its monetization strategy at a quicker pace as a result.

“Their demographic is much more cutting-edge, demanding and fickle,” noted Bill Carroll, a senior analyst for Katz Media, a firm which advises TV stations on programming decisions.

In fact, CW digital chief Rick Haskins told paidContent Tuesday that the network received 18 percent of its viewership during the just-completed 2011-12 TV season from digital platforms.

“When you’re bumping up on 20 percent of your viewing being someplace else, you’re model has to be different,” Haskins said.

For CW, that “different model” means limiting the differentiation between broadcast and streaming for both viewers and advertisers.

While Fox delays free streaming availability of its shows for eight days after initial linear airing, CW has cut that wait time down to just eight hours on its CWTV.com channel.

The CW has been putting full TV-like commercial loads into its streams for several years and pushes harder than any other network to integrate the sale of impressions on its digital platforms with those on its linear channel to advertisers.

While ratings have trended down for the network recently, ad sales have not. During last year’s upfront market, for example, the CW generated nearly $420 million in ad revenue, which was 10 percent year-over-year growth.

Having worked to create its own systems of measuring viewership across platforms for several years, network president Mark Pedowitz told advertisers during the CW upfront presentation two weeks ago that the company will soon introduce its own fully-baked cross-platform ratings system to the TV industry.

Almost in the same breath, Pedowitz touted a new digital studio that will specialize in low-cost, short-form digital content, extending the CW brand mobile platforms in a way no other network has attempted.

About those ratings…

But as the CW transitions into a next-generation, multi-platform video programmer, it can’t surrender the underpinnings of its traditional business model — drawing viewers to its affiliate broadcast stations, which still accounts for more than 80 percent of its viewership.

And right now, that part of the business isn’t going well.

On Friday, ratings tracker Nielsen revealed that for the just-completed 2011-12 TV season, CW’s primetime usage dipped 15 percent to an average of only around 1.5 million watchers. Viewership for the network’s target demographic, adults 18-34, dropped 20 percent to 800,000.

With ratings like these, how can the network’s affiliate partners survive, much less negotiate hefty retransmission fees with cable and satellite operators?

It is here where the Netflix licensing deal has helped tremendously, delivering the network — which had previously struggled to sell its shows to cable and syndication — back-end resources for the first time.

Rather than having to further cut back on the number of fresh, original programming it will supply to its affiliates next season — thus further dropping ratings — CW announced that it will have 50 additional hours of original series on the air next year and will be able to supply original programming during the summer for the first time.

“We’ve taken the money and put it back into supporting the model,” Haskins noted.

Here’s former CW president Dawn Ostroff discussing the Netflix deal with paidContent editor Staci Kramer last year:

That’s because while an impressive-sounding 95 percent of the ads are being watched from beginning to end, it’s not like viewers have any choice. While the stat conjures up images of an online audience increasingly enraptured by a multiplying supply of commercials rather than just one per break, it’s worth noting that if viewers want to get through an episode of, say, Gossip Girl, there’s no fast-forwarding or changing the channel possible online unlike the way those options are available on TV. If you want to get through the episode, you have to let the ads play.

While CW can congratulate itself that the audience didn’t reject the increased ad load, it’s probably not the case that they enjoyed it, either. The more telling stats to come concern engagement: did viewers actually click on the ads to find out more about the products? It’s quite possible that while they didn’t close out of the video window, they just opened their Facebook or some other diversion in another window only to click back in once the audio from the commercial indicated the episode resumed.

It should come as no surprise that CW is trumpeting the findings considering its declaration heading into the upfront marketplace earlier this year that it would boost online ad volume as part of a move to combine TV and online sales. Doubling the commercials may actually be just the beginning of what’s to come if Nielsen’s long-delayed Extended Screen Initiative finally gets off the ground; that would track identical TV and online feeds. That would mean even more ads online.

Most interestingly, CW is stepping up its online strategy just as its fellow broadcasters appear to be shrinking from the challenge. That’s because of the increasing evidence that negotiation-bruised Fox et al may take cues from their cable brethren and begin limiting the amount of ad-supported streaming they do in pursuit of retransmission fees. If it’s not too careful, CW could end up more of an outlier than an innovator.

– Top ad exec departs for MLB cable net: It will take more than Gossip Girl to fix what ails the CW, which is jointly owned by CBS Corp (NYSE: CBS). and Time Warner (NYSE: TWX). WSJ, citing unidentified sources, says that the network is losing Bill Morningstar, its head of ad sales. Morningstar, a popular figure with media buyers, is said to be heading to Major League Baseball’s new cable startup, which is set to go live on Jan. 1.

The show’s audience is younger, which would naturally leans towards watching more video and shows online than other demos. The move is being done “as an experiment” to figure out if its online window is cannibalizing the TV audience. The show is as popular online, and each episode is generating hundreds of thousands of streams, the story says…it is among the most downloaded TV shows on iTunes (where also will continue to offer new episodes, for a price, of course). More power to BitTorrent, of course…

LAT: The move is designed to boost ratings for the program, which has developed a loyal online following but has failed to attract a sizable TV audience. The show’s average of 2.5 million viewers has not been enough to lift CW out of the ratings cellar or staunch its financial losses.

Another way of looking at it, from TvbytheNumbers: “Now CW is using the Internet to promote the show in a way that might seem very strange, but probably isn