In the mid-1960s, a new wave of research revealed the depths of unmet educational needs of impoverished preschool-age children and the high costs of addressing these needs via traditional classroom-based programs like Head Start. Against this backdrop, the concept of using television as a vehicle to improve early childhood education at scale came up at a 1966 dinner conversation between documentarian Joan Ganz Cooney and Carnegie Corporation of New York Vice President Lloyd Morrisett.

Together, they developed the concept and launched a new program they called Sesame Street, and by 1993, 77 percent of all preschoolers in the United States watched the show at least once a week, including 88 percent of those from low-income families, with significant positive effects. Among other outcomes, a recent study from the National Bureau of Economic Research found that children who watched were more likely to be kindergarten-ready and an estimated 30 to 50 percent less likely to fall behind grade level, with the greatest impacts on the most disadvantaged children. Another study found that it had a positive impact on children’s attitudes towards people from diverse backgrounds. Today, Sesame Street reaches some 156 million children in 150 countries around the world.

How did this innovative concept for early childhood education gain traction nationwide and go global? On the heels of their 1966 dinner, Carnegie provided funding for Cooney to conduct a rapid-fire feasibility study on whether TV programming could both attract and educate children in need. Based on her promising initial findings, Cooney proposed piloting an educational children’s television show with a strong commitment to both entertainment and learning outcomes for kids. Cooney and Morrisett worked together, planning Sesame Street as a highly professional operation. Their proposed budget was huge for an unproven concept, $6 million ($46 million in 2017 dollars), but Morrisett found co-investors in Carnegie, the Ford Foundation, the Corporation for Public Broadcasting, and the US Office of Education. The Children’s Television Workshop (CTW) was created to produce the show.

That budget supported top-notch production—Cooney recruited the executive producer of Captain Kangaroo as Sesame Street’s executive producer, along with Jim Henson and his Muppets. It supported evaluation of the educational and entertainment value of each episode, and also allocated a significant portion—8 percent of the total initial budget—to an extensive outreach and publicity campaign to help drive viewership.

In the show’s first week, in November 1969, nearly 1.5 million television homes tuned in to Sesame Street—already more children than attended formal preschool. By 1970, around 36 percent of all preschool-aged children in the country watched the show. By 1979, nine million children under age six watched it every day, with especially strong penetration in inner cities. And children who watched the program demonstrated clear educational progress. A 2001 study found that the show’s positive effects on a viewer’s reading and scholastic achievement lasted through high school.

The popularity of Sesame Street’s characters meant that their financial model began looking more similar to a traditional media business, benefiting from the sale of their content to networks, while also collecting licensing fees from the sales of toys, T-shirts, and other products based on their characters. In the 1980s, philanthropic and government funding for Sesame Street declined, but earned income from licensing and distribution (unrestricted in its use) grew by leaps and bounds. Whereas in 1970 Sesame Street was entirely supported by grants, by 1980, 57 percent of its revenue came from licensing and distribution. Of course, the shift toward licensing and distribution revenue made the organization more susceptible to competition and market forces, leading to financial challenges at times, particularly in the 1990s, and also more recently with the significant disruptions in the industry brought on by streaming television and consumer cord-cutting. But the flexibility of the funding model for core programming has also allowed the organization to use its philanthropic funds to enter developing countries and other international markets, a global push that began in 2000. Today, Sesame Street programming, adapted for local language and customs, reaches more than 156 million children across 150 countries.

Researched and written by Consultant Andrew Flamang of The Bridgespan Group, based on Bridgespan interviews with Daryl Mintz, chief financial officer, and Sherrie Rollins Westin, executive vice president for global impact and philanthropy at Sesame Workshop, as well as selected secondary sources.

Selected Sources