That's already happened to a large degree. Most local affiliates will most of their day with syndicated programming. Nearly all are on the air 24 hours a day, with the network providing a smaller and smaller slice of the programming pie. Morning and evening news, the 8-11 prime time block, and sporting events -- that's all most stations get from the network. Maybe one or two daytime soaps, but there are fewer of those than there used to be.
I don't remember the last time I saw a theatrical movie aired on a big-three network. They used to be a mainstay. For that matter, made for TV movies and miniseries have largely shifted to the cable nets. With video rentals and sales, downloads and on-demand cable, who wants to sit through commercials?
Network evening news broadcasts will go dark after the '08 elections and their news divisions will be disbanded.
Not a chance it will happen that fast. The Big Three evening newscasts combined still draw about ten times the audience of the cable news networks.
But the more important fact to remember is that the news divisions don't just work to produce that one half-hour a day. The morning shows make real money, and they have enough local affiliates to offer local weather and traffic, stuff folks want to know when they're getting ready for work and which cable can't deliver. News magazine shows are cheap enough to produce that they can be profitable even if they're not huge ratings winners.
What you probably will see in short order is a continuation of the trend of the last 20 years -- fewer bureaus, fewer correspondents in the field, more reliance on agencies and affiliates. More talking heads and celebrity fluff, because those are a lot less expensive than putting a lot of crews on a lot of planes.
It's pretty much the same phenomenon that has happened to newspapers. Few newspapers have correspondents or even stringers spread out across the country -- they use the AP for out-of-town newsgathering. Or big companies like Gannett, McClatchy, the NYT and the Trib share stories between their papers. When your local paper puts together its national and international sections, they do far more aggregating than reporting.
Not to be too terribly argumentative here, but if what you say happens, will they still be "news" divisions? Or will they then be just another "entertainment" division?
My point is that if you take ALL the programming produced by the news divsions - evening, morning, primetime - and forced them to carry the overhead of all the reporters, producers, staff and so forth, it would be a net loser. I'm suggesting the entertainment totes the freight and "news" as networks have produced for decades doesn't make money.