I knew the (second, I believe) story editor for Baywatch, and the self-deprecating story I remember hearing directly from him some years ago is consistent with the previously given history, but not the same. I hope my memory can do him justice.
My acquaintance claimed to have personally pushed the series toward all the flesh and slow-motion that television would allow, looking for higher ratings and appealing to adults. Probably he had some help and support in this crusade, since story editors aren't all powerful. Unfortunately, after a while the ratings kept dropping. And dropping. Finally when there seemed little hope left of saving the series, David Hasselhoff pulled rank and in effect took over editorial control of the show with a threat to leave which would certainly have ended the series, and my acquaintance departed the post of story editor, taking his sex sells philosophy with him.
Hasselhoff turned the series into one for children and young adults, in which the bathing suits were much more modest and the sex understated - but the women were just as beautiful, their breasts didn't shrink, and the suits were still tight because bathing suits are all tight; and y'know, what with all those emergencies, there was still a whole lot of running around involved. Hey, people run in emergencies. Can't be helped.
The genius of this move, said the story editor (who as you'll remember left because he was sure it wouldn't work), was that the show now appealed to two audiences: kids, and dads. Dads could now sit down and watch with their kids, doing the family thing and still getting an eyeful - and mom wouldn't just let him watch now, she'd be thrilled that he was sharing a moment with the young'uns - albeit for slightly different reasons. A year earlier the very most dad would have gotten for his devotion to Baywatch from his beloved was dirty looks. Now he got a pleased smile for being such a good family man.
The lesson? Sex sells when you're alone, but hypocrisy never goes out of style – and it sells all the time, and to the whole family.
Once it had been remade as the sexiest kid show ever filmed, Baywatch's ratings climbed steadily up into the stratosphere, and no-one questioned its babeography because Baywatch now seemed exceptionally modest compared to its old self. Everyone who had survived the purges lived happily ever after, as did dads everywhere. Even so, Baywatch will always be remembered for its time of scanty suits and fleshy slo-mo in the collective consciousness, rather than its later, and so much more successful, seasons. (And they say one person can't change the whole world.)