How do the ratings know what I'm watching?

Answer 1

The ratings don't know what you are watching, but, for that matter, cabel providers do. For the rest, as far as I know, there are average households in the US and other countries, whom are contracted with companies, whom install devices that track there television habits. Than these companies sell these results to newspapers, and television companies, and so on. So although only a small amount of households are actually tracked, it gives a prity good estimate of which show/Chanel do people prefer the most.