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HBO Strikes Deal for 'Sesame Street'
Source: Dow Jones News
Big Bird is flying over to HBO.
Known for its dramas and risqué comedies aimed at adults, including "Game of Thrones," "True Detectives" and "Girls," Time Warner Inc.'s HBO has formed a partnership with Sesame Workshop in the hopes of becoming a major player in children's television.
The move is the latest by HBO to better position itself against competitors including Netflix Inc. and Amazon.com Inc., each of which have moved aggressively into children's television through original content and rerun acquisitions.
"When we had an opportunity to put an iconic show like 'Sesame Street' on the network, we jumped on it," said HBO Chief Executive Richard Plepler."
Under the terms of the deal, starting this fall HBO will become the first stop for new episodes of the children's classic "Sesame Street" before they appear on their traditional home of PBS nine months later. The agreement will allow Sesame Workshop to nearly double the number of new episodes of "Sesame Street" it makes yearly from 18 to 35.
Sesame Workshop will also produce a "Sesame Street" spinoff and another educational series for the premium television service and its online platforms HBO Now and HBO Go that could end up on PBS as well.
In addition, HBO is acquiring the subscription online video rights for older episodes of "Sesame Street" after current agreements with Netflix and Amazon expire later this year. HBO is also licensing repeats of "The Electric Company" and "Pinky Dinky Doo," a cartoon for preschoolers from Sesame Workshop.
Although "Sesame Street" and the other children's programming HBO is getting will be available on its traditional TV channels, the real motivation is to have content available for its online services HBO Go and HBO Now.
Children are increasingly watching shows via streaming services instead of traditional television. According to Jeff Dunn, chief executive of Sesame Workshop, two-thirds of children now first experience the show on video-on-demand and streaming services.
"We're thinking about the different ways people are watching and thinking about different audiences," said Mr. Plepler. He played down the idea that a motivation for the pact was the success Netflix and Amazon are having with children and families. "What informs all our decisions is we want to put great programming on the network," he said.
For Sesame Workshop, the HBO deal is a life raft. Mr. Dunn, a former top executive at Viacom Inc.'s Nickelodeon who became CEO of the nonprofit educational organization last October, said he started thinking about finding a partner soon after he joined.
"It quickly became clear to me that the economics of the organization needed to change," he said. Sesame Workshop was operating a deficit and last fall he let PBS know that "we can't continue to lose money like this."
Contributions from PBS only account for 10% of Sesame Workshop's revenue. The bulk comes from licensing and DVD revenues. However, the latter has diminished as more children get their entertainment from online platforms.
"If this is where the children are, we have to recognize that shift and have more than just a home on PBS," Mr. Dunn said. He briefly considered launching a subscription video-on-demand service for Children's Television Workshop but ultimately decided the economics were "not very compelling" and that the organization would be better off teaming up with a premium brand.
However, a completely exclusive deal was never on the table. "Our number-one issue was to remain with PBS," Mr. Dunn said. In a statement, PBS said the HBO arrangement wouldn't mean a reduction in its commitment to children's programming.
But it will make things easier on the wallet. As part of the agreement with HBO, PBS and its member stations will no longer have to pay for episodes of "Sesame Street."
Sesame Workshop will retain all editorial control over the content of "Sesame Street" and its other shows.
Write to Joe Flint at joe.flint@wsj.com
HBO Strikes Deal for 'Sesame Street'
Source: Dow Jones News
Big Bird is flying over to HBO.
Known for its dramas and risqué comedies aimed at adults, including "Game of Thrones," "True Detectives" and "Girls," Time Warner Inc.'s HBO has formed a partnership with Sesame Workshop in the hopes of becoming a major player in children's television.
The move is the latest by HBO to better position itself against competitors including Netflix Inc. and Amazon.com Inc., each of which have moved aggressively into children's television through original content and rerun acquisitions.
"When we had an opportunity to put an iconic show like 'Sesame Street' on the network, we jumped on it," said HBO Chief Executive Richard Plepler."
Under the terms of the deal, starting this fall HBO will become the first stop for new episodes of the children's classic "Sesame Street" before they appear on their traditional home of PBS nine months later. The agreement will allow Sesame Workshop to nearly double the number of new episodes of "Sesame Street" it makes yearly from 18 to 35.
Sesame Workshop will also produce a "Sesame Street" spinoff and another educational series for the premium television service and its online platforms HBO Now and HBO Go that could end up on PBS as well.
In addition, HBO is acquiring the subscription online video rights for older episodes of "Sesame Street" after current agreements with Netflix and Amazon expire later this year. HBO is also licensing repeats of "The Electric Company" and "Pinky Dinky Doo," a cartoon for preschoolers from Sesame Workshop.
Although "Sesame Street" and the other children's programming HBO is getting will be available on its traditional TV channels, the real motivation is to have content available for its online services HBO Go and HBO Now.
Children are increasingly watching shows via streaming services instead of traditional television. According to Jeff Dunn, chief executive of Sesame Workshop, two-thirds of children now first experience the show on video-on-demand and streaming services.
"We're thinking about the different ways people are watching and thinking about different audiences," said Mr. Plepler. He played down the idea that a motivation for the pact was the success Netflix and Amazon are having with children and families. "What informs all our decisions is we want to put great programming on the network," he said.
For Sesame Workshop, the HBO deal is a life raft. Mr. Dunn, a former top executive at Viacom Inc.'s Nickelodeon who became CEO of the nonprofit educational organization last October, said he started thinking about finding a partner soon after he joined.
"It quickly became clear to me that the economics of the organization needed to change," he said. Sesame Workshop was operating a deficit and last fall he let PBS know that "we can't continue to lose money like this."
Contributions from PBS only account for 10% of Sesame Workshop's revenue. The bulk comes from licensing and DVD revenues. However, the latter has diminished as more children get their entertainment from online platforms.
"If this is where the children are, we have to recognize that shift and have more than just a home on PBS," Mr. Dunn said. He briefly considered launching a subscription video-on-demand service for Children's Television Workshop but ultimately decided the economics were "not very compelling" and that the organization would be better off teaming up with a premium brand.
However, a completely exclusive deal was never on the table. "Our number-one issue was to remain with PBS," Mr. Dunn said. In a statement, PBS said the HBO arrangement wouldn't mean a reduction in its commitment to children's programming.
But it will make things easier on the wallet. As part of the agreement with HBO, PBS and its member stations will no longer have to pay for episodes of "Sesame Street."
Sesame Workshop will retain all editorial control over the content of "Sesame Street" and its other shows.
Write to Joe Flint at joe.flint@wsj.com
