The Pakistan Electronic Media Regulatory Authority (PEMRA) has finally delivered on its promise to issue three Direct-To-Home (DTH) satellite broadcasting licenses after a bidding process, one that far exceeded their own best estimates. With PEMRA hoping to receive Rs1.5 billion for each licence, the actual amount for each was above Rs4.8 billion, which is evidence of just how lucrative the prospect of owning one of the three licenses in Pakistan seems.

With a market of over 25 million TV watchers and 5 million consumers of illegal Indian DTH services, this move has been long overdue. But as expected, the bidding has not gone down all too well with cable operators, who feel short-changed for not being allowed to participate in the process. The power of cable TV operators has been virtually limitless since their rise. TV channels and cable operators have cozied up to each other, and there are various reports of money being exchanged under the table for channels to be strategically placed before their rivals in order to increase viewership. All the backdoor dealings that have been conducted will come to naught, and they will no longer be the kings in their own field. Decreasing revenue through decreasing bribes and an increasing demand for DTH will not please the operators.

The mantra of granting licenses has been in the air since 2003, and cable operators were probably expecting that DTH would be introduced under their supervision as well. But foreign investors were given preference, which is not surprising considering that the cost of the licenses went up by more than double as a result. The government’s move to introduce DTH broadcasting was not news to the cable operators; their control over the television viewership has been practically absolute since the dawn of cable TV in the late 1990’s.

While they still have a market in the short term, the number of customers opting for DTH services is likely to increase dramatically once local (and legal) players enter the market. However, even after, some experts estimate that cable operators will still own 60 to 70 percent of the market in the immediate future owing to an infrastructure that is spread all over the country, and the price advantage cable operators will inevitably enjoy over DTH. DTH will obviously not be rolled out in a day. The 5 million subscribers of illegal DTH are only 5 percent of the market – more will join them, but not even half in the short term. Time will be needed for the service to reach parts of the country that are not as developed as city centres. Until then, the cable operators can enjoy their spoils. And after, while the operators might not be able to control the market completely, but they will still own a large portion of it.