Does anybody else suspect that the new studios might, in the long run, end up proving to be a huge financial folly for Channel 5/NBC?
Here is why I think it might be: My guess is that television stations - not just terrestrial but cable as well - will follow newspapers into a long decline towards eventual extinction. How much of the programing on Channel 5 and other stations is prerecorded? Most of it. And once such programing becomes available on-demand, what will be the point of bothering to tune in on the "real time" playback/broadcast? With on-demand, people will be able to tune into any program they want whenever it is convenient for them - and be able to catch up on as many back episodes as they wish as well. The only programing likely to remain relevant in an old fashioned "real time" television format will be that which necessarily must be live such as sporting events and breaking news. But that is a small percentage of the programming that is currently on television.
This is going to impact both local stations as well as national networks. In the past, those who produced programing HAD to first get past the "gatekeepers" at the networks and cable channels in order to deliver their product to an audience. If everything goes on-demand - what is the point of an organization such as NBC? Why not just deliver the product to one's audience directly - or use third party distributors such as itunes or Amazon? Perhaps companies such as NBC will be able to find productive ways to insert themselves into the process to everybody's benefit. But, if so, it will be a radically different world than what they are doing today.
All of this, of course, will not happen overnight. There are still areas of the country that still do not have the residential bandwidth necessary to make on-demand practical - and while that's the case, they will continue to rely on terrestrial and satellite programing. And, even where bandwidth is available, it takes time for people's habits to change. But can anybody deny the following two points - that broadcast/cable television is a shrinking pie and that nobody knows with any degree of certainty what the technological/distribution landscape is going to be like in 10 or 20 years?
A new facility is an expensive, long-term investment. Does it make sense to sink money into such long-term investments in a technology/industry that is in decline and which will be required to transition to a not yet fully discovered new business model in the not too distant future? In many industries, if one invests in new technology, one had better be prepared to get a fairly quick return on investment simply because it will likely be obsolete and in need of an upgrade in three or so years.
I understand that there are operational savings that can be realized by having a single centralized location. But how long will it take for those to offset the costs of a new facility verses having an already bought and paid for facility - and can Channel 5 count on having that time? And if the cumulative extra driving expenses/man hours to Dallas/Collin Counties from its East Side studio versus the Amon Carter Drive location is so expensive, there is a glut of warehouse type buildings in the Dallas area that can be leased cheap. Not very glamorous perhaps - but viewers don't know or care.
Perhaps there are factors that I haven't considered that cause the whole thing to make sense. But, offhand, it strikes me as making about as much sense as the Morning News or Star-Telegram dropping a ton of money on building brand new fancy, state-of-the-art facilities - when, in fact, it is an open question as to how long they will still be around and in what form. It makes me suspect that it might be ego driven or some sort of pursuit of corporate prestige. Ego and prestige can be very expensive masters - and I can think of two companies here in Fort Worth that learned that lesson the hard way: Radio Shack and Pier One. Both built very impressive, expensive and showy headquarter buildings in or near downtown. And as soon as they moved in, the companies found themselves in financial trouble and having to fight for survival. Both of them ended up selling the buildings within a very short time - Radio Shack's headquarters is now a junior college and Pier One's was purchased by Chesapeake Energy. Had they instead spent such money on areas more crucial to the business, perhaps they would have been in better shape.
Is Channel 5 perhaps making a similar mistake on a bit smaller scale? Would they be better off using that money instead to perhaps figure out a more viable long term business model or save it for potentially tough times ahead?
