NextGen's massive budget overrun shouldn't be a surprise to anyone who's managed large projects. Budget estimates are based on previous experience; "this new project is similar to this other project we did in the past and that project cost X."
At its heart, NextGen is a massive infrastructure upgrade of the entire WDW network. Disney is trying to integrate together all of its disjointed systems that were added piecemeal into one all-encompassing "Skynet", controlling all aspects of WDW. It's a massive undertaking and unlike anything they've tried in the past. Of course, they are going to come up with a budget that's more guess than anything else.
The problem with big budgets is that starting with a really big number tends to kill the project before it's ever launched. Even if the team manages to come up with an estimate that has some basis in reality, inevitably those higher up the food chain randomly lop off numbers.
The team come up with a budget of $2B. The team's head says, "that's too much, let's cut 20%." The budget gets sent upwards for review and the senior VP says, "$1.6B is too much, we can do better, let's cut 20% and make it $1.3B." Now the segment head has a look and says, "can't you do better? Try for $1.1B." Finally the CEO gets involved and says, "great, sounds like a wonderful idea, however, I have confidence in you and your team; I know you can do better, let's bring it in under $1.0B." Everyone in the room nervously plays with something in front them because to actually stand up and declare "the emperor has no clothes" is effectively to write your own resignation letter.
Disney will continue to throw money at NextGen no matter how bad it gets because CEO Bob Iger owns it. In Wall Street's eyes, NextGen has become Iger's project. Wall Street repeatedly has asked Iger about it and Iger repeatedly has defended it. The following exchange from the Q2 FY13 earnings call is typical:
Q: "Bob, if you could talk about the timing of the rollout of My Magic Plus. Is there any way to give us a sense of the potential impact from that initiative? It's not the easiest thing for us to model."
This is polite Wall Street code for "we don't see how this thing will ever make money."
A: "In terms of what we can expect from it return-wise, you're right; it's somewhat -- although we've modeled it -- it's somewhat difficult to be specific about. You can expect that it will create a better experience, and with that we believe people will spend more time at our parks and ultimately deliver more business per guest."
This is Iger's polite way of providing a BS smoke-and-mirrors answer. What are you saying Bob, that up till now, every other project you've done was to create a worse experience? (I guess with all the quality cuts we've seen at WDW, the answer to that is "yes".)
Forget about what's actually going on with NextGen testing. From a cost-benefit perspective, the wheels already have fallen off the NextGen cart.