You, like most people, are overlooking a few facts here. New Orleans used to be well inland and above sea level. A long series of environmentally disastrous policies lowered the water table, removed natural barriers, concentrated storm surges, and generally guaranteed that NO was a disaster waiting to happen.
Unfortunately the government and Army Corps aren't legally liable for severe technical malpractice and rank stupidity. This suit slips through a loophole in the legal immunity the government gave the Corps.
New Orleans could be saved. And the cost of abandoning a major city is immense, far more than building better hurricane defenses. Building better hurricane walls will cost far more than restoring wetlands, allowing the water table to recover, and re-engineering the waterways. Of course, the best/cheapest solution is probably the one least likely to be selected by our broken political process.
And the cheapest solution of all (short-term) is to blame the victim and do nothing. It's worked really well so far.
If it is a typical complex, highly-customized business system, it will have:
So, I'd say your Phase 1 above is a vast under-estimation. And the idea that you can farm it out to an external organization, especially one without close personal contact with users, is pure fantasy.
At the end of your process you'll have a system that does maybe 20% of what the users actually need, and 50% of which is stuff no one needs any longer.
Interesting analysis. One problem with it is that much of the "payment" demanded for digital goods is not actually directly linked to the labor used to produce it. A lot of the resistance to paying for music would go away, if the people paying were confident that a) the money was going to the people who created the music, and b) it was a "fair" payment for that music. Most people don't mind if Paul McCartney makes a billion dollars, but much of the music industry is designed to siphon money away from the artists and distribute it to parasites.
In the past, people couldn't do anything about that, it was buy an LP/CD or nothing. Now consumers have choices, and they'd rather go to a lot of trouble to download for free, than pay $.99 for a song where $.01 goes to the actual artists.
This brings up a serious thought. Combine the following:
What's to keep Russia from unilaterally taking over the Station? What, exactly, would we be able to do about it?
Politics: A strife of interests masquerading as a contest of principles. The conduct of public affairs for private advantage. -- Ambrose Bierce