This show is probably the best show for babies, toddlers, and especially kids going into preschool. You actually learn things while being entertained at the same time (unlike Barney). The show is full of color and will easily keep kids' attention.
When I'm watching the show with my 11 month old niece, I sometimes find myself watching the show and getting a little bit of enjoyment out of it as well.
Its not hard to see why this show has been running for 40+ seasons.