Walking the halls of the NAB Show this week and talking to other attendees, I was constantly reminded that the TV industry - both networks and local stations - is in transition from "what was" to "what will be."

"What was" is well understood: an economic model built over a 50+ year period through a carefully managed, geographically-demarcated distribution network of local stations that until recently held a de facto exclusive right to distribute high-quality programming. This model worked extremely well for both broadcast networks and stations as they tapped into surging advertising budgets fed by Americans' insatiable consumption habits.

As the great consumptive bubble has burst, the broadcast industry's troubles have come into full view. In fact, with every single element of the traditional model now under attack, it is obvious that "what was" is fast-yielding to "what will be." The problem is that "what will be" is still incredibly ambiguous. Having informally taken the pulse of others at the NAB show this week, the picture that emerges is one of deep concern that "what will be" may be radically different and not necessarily very attractive.

I continue to return to the simple fact that as network program viewership shifts to online, maintaining revenue parity is essential to sustain the cost side (i.e. program development) of the business. If ad revenues come up short then the traditional Hollywood production system will be punished. And the program quality issue is all the more urgent since increasingly popular cable TV programs keep peeling eyeballs away.

For local stations the situation is far more complex, and I believe insoluble in the long run. That's because their monetization challenges are much deeper. Limited primarily to local advertising categories that have been hit disproportionately hard by the recession (e.g. autos, retail, real estate) and the shift to online advertising (e.g. classifieds), local stations must find new ad sources to survive. But where these will come from, in a size that matters, is unclear.

Then there's the fact that the news/sports/weather content that has been their bread and butter has been eaten away by online alternatives. And last but not least is the reality that the broadcast networks, which have embraced all manner of alternative program delivery options, have all but gutted stations' prime-time value.

Add it all up and I for one am stumped at where local stations go from here. Massive consolidation, including possible mergers with their local newspaper brethren, to radically rationalize the newsgathering process in local market, seems more and more likely to me.

The sobering reality that two of America's great industries - automobiles and newspapers - are on their way to oblivion should be a big-time wake up call to broadcasters that a sense of permanence can in fact be illusory. At the risk of sounding alarmist, I think the survival of the broadcast TV industry in its traditional form will soon enough be in question.

What do you think? Post a comment now.