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Comcast’s In Preschool Game

10/24/2004 8:00 PM Eastern

Comcast Corp. is now officially in the preschool-TV sandbox, partnering with kidvid heavyweights Sesame Workshop, PBS and United Kingdom-based HIT Entertainment PLC to launch a toddler-targeted 24-hour digital-cable service in 2005.

The yet-to-be-named network, which will also include a robust video-on-demand package, will feature such popular toddler-targeted shows as Bob the Builder, Barney and Thomas and Friends, as well as classic titles from the PBS, Sesame and HIT vaults, said network representatives.

Financial terms of the deal were not released. HIT, which produces Bob the Builder and Barney, said it will hold a 30% stake in the network, but it’s unclear how the balance is split between the other partners.

Also unknown is Comcast’s rate card for the service.

News of the preschool network, which will compete with Nickelodeon and Disney Channel, among others, in an already-crowded arena, first surfaced last June. While some question the need for an around-the-clock preschool network, given the waking hours of young children, it adds another genre of content to Comcast’s growing stable of entertainment and sports services.

Overall, sources said PBS, HIT and Sesame will each provide up to 30% of the network’s programming, with the remaining share filled through acquired fare.

On the advertising front, sources said the network will adapt the PBS model of sponsorships for specific shows or blocks of programming.

The companion on-demand package will include more than 50 hours of programming per month for preschoolers and their families, said network executives.

“We’re committed to launching this new channel in a significant number of our markets, and we will work with other cable and satellite companies to reach as many customers as possible,” Comcast chairman and CEO Brian Roberts said in a statement.

Comcast executives said it’s too early to discuss programming, advertising or distribution specifics of the channel.

For Comcast’s content partners, the network represents a golden opportunity to expand the potential viewership universe for their highly targeted programming.

“We think it provides a good second home to programs that are currently benefiting from analog distribution [via PBS stations],” said PBS chief operating officer Wayne Godwin.

VOD FARE FOLDED IN

The PBS Kids digital-cable and VOD offerings will be folded into the new venture, although Comcast will have to negotiate new deals with MSOs and DBS providers to retain the services’ respective 20 million and 11 million subscribers.

Comcast, DirecTV Inc. and Cablevision Systems Corp. are among the carriers of those PBS services.

“This is a business situation in which there are definite points where the deals will have to change over to the business practices of this network,” Godwin said. “PBS Kids is a strong offering, and we think the providers will see it in their best interest to serve the best interests of their subscribers to become a part of this.”

The network will compete against daily morning preschool programming blocks from Nickelodeon (Nick Jr.), sister service Noggin and Disney Channel (Playhouse Disney), as well as PBS stations, which will retain first-run rights to shows like Sesame Street.

Cartoon Network is also planning to launch a two-hour weekday-morning block targeted at two- to five-year-olds next April.

But Nickelodeon feels that its pre-school block will not be adversely affected by the new Comcast network.

“The preschool audience is very well-served by Noggin, Nick Jr. and other networks,” said Nickelodeon spokesman Dan Martinsen. “We’re going to keep making great preschool programming for that audience and we wish them well.”

NOGGIN SHOW HIT?

The deal though, could cost Nickelodeon-owned kids service Noggin some valuable pre-school programming. Noggin’s agreement with Sesame for classic library content like Sesame Street expires in March 2005.

A Sesame spokeswoman, though, would not confirm or deny whether that programming will migrate from Noggin to the new channel.

The Sesame spokeswoman did say the new network would not nullify its deal to develop programming for Noggin, currently in 42 million households.

“They are a great partner for us — they will always be a viable outlet for our programming where appropriate,” she said.

It’s also unclear whether the HIT-produced series Bob the Builder will remain on Nickelodeon’s pre-school Nick Jr. block when the new network launches.

“We’ll evaluate each [show] on a case-by-case basis,” said HIT spokeswoman Nicole Blake.

September