Sesame Street’s new address at HBO

Mark Garrison Aug 13, 2015
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Sesame Street’s new address at HBO

Mark Garrison Aug 13, 2015
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Sesame Street is relocating to HBO.

The landmark children’s television program is moving to pay TV after a decades-long run on PBS. A new deal announced Thursday will give HBO first dibs on new episodes, though they will ultimately be available free for PBS nine months later.

The idea of Big Bird and friends — among the most recognized and celebrated in public broadcasting — scurrying behind a paywall went from unthinkable to inevitable, driven by the current realities of how we watch, or increasingly, stream, our favorite shows. Even though Sesame Street aired on PBS, most of the money to pay for its production came from elsewhere, say media watchers.

“The reason Sesame Workshop was able to keep producing Sesame Street at very high cost is because they had extraordinary DVD and merchandising revenue, and that has started to decline,” explains Jim Steyer, CEO of the nonprofit Common Sense Media.

DVDs aren’t worth much in a streaming age. The collapse of a reliable revenue stream meant the company had to change, he says. Though, many observers recognize the potential for a backlash from fans angry at having to pay HBO to see new episodes, they recognize that current economic realities forced Sesame’s leaders to explore something new.

“The ability to extend its franchise, extend its brand and in particular get that type of funding from a private source is just enormously important for them,” says Jeffrey Jones, a University of Georgia professor who directs the Peabody Awards, which have honored Sesame Street and many HBO programs over the years.

HBO gets access to top-drawer children’s content, a hook to lure new subscribers. And Sesame gets a deep-pocketed partner, ensuring it can make more episodes, without facing tradeoffs on quality.

“If HBO is the corporate partner that can fund that and help that happen as opposed to their prior relationship with PBS, then that’s the way the chips fall,” says Jon Swallen, Chief Research Officer at Kantar Media.

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