As Michael Piller says, "if you're going to have a show set in space, you basically have three options - on a ship, on an alien planet, or on a space station."
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With the ship option ruled out for the moment, Berman and Piller decided to set the series in another common Star Trek setting - a starbase, and they briefly thought about selecting a starbase on an alien planet. The alien planet that came to mind was Bajor - a world that they had created in their Next Generation script "Ensign Ro."
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That episode had briefly featured a makeshift Bajoran refugee encampment on the planet's surface, and Berman and Piller thought equally briefly of expanding on that idea as the new series' setting - envisioning it as an alien version of a Hong Kong colony, built as a live set north of Los Angeles.
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But with the cost of a full, first-unit production crew running at about five to six thousand dollars per hour, and thinking about those charges totaling up each week for the two half-days it would take to move production of the series from the interior sets on the Paramount lot to the hypothetical live sets in some undetermined location and back again, both Berman and Piller gave up the idea of that kind of setting very quickly. And since outdoor settings are difficult to realistically achieve on an indoor set, that propelled them toward the third option: a space station.
