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The Nets did this with Sean Williams a few years back too, and it had no discernible positive impact. I think it's a completely different GM/coaching staff since then, but you would think someone would have learned that lesson.
To be honest, I don't think the Nets care much about what will happen to Terrence Williams. If he wakes up, great. If not, he's on his way outta the NBA anyways. The dude is sucking big time this year, in the NBA. He has no work ethic and still thinks his lottery pick makes him a star without working at it. If this demotion to D-League doesn't wake him up, nothing will.