Industry players face advertising challenge due to political instability and economic downturn but there is a history of failure.
Pakistan's media a hype of activity
ISLAMABAD // Pakistan's highly competitive independent news media are in the middle of a major expansion despite a recent record of failed projects, industry insiders say. The expansion began on April 12 with the launch of The Express Tribune, a daily English-language newspaper published in Karachi in collaboration with the International Herald Tribune.
The Tribune is the third major media project launched in as many years by the Express Group, which is chaired by the former tobacco magnate Sultan Lakhani and based in Lahore. Working with a reported budget of 8 billion rupees (Dh627.5 million), drawn from the March 2007 sale of the Lakhani family business to Philip Morris International, the group has also launched successful Urdu and English cable news channels in January 2008 and February of last year, respectively.
But the success of the Express Group is a rare one in a market crowded with more than 20 cable news networks, and its English channel and newspaper are yet to turn an operating profit, TV channel managers say. All current managers interviewed by The National sought anonymity because they were not authorised to speak. Most projects initiated since the government lifted restrictions on news media ownership in 2003 have either gone bankrupt or are in deep financial trouble, the managers say.
Constant changes of management and programmes at the TV channels are typical in their desperate quest for success, particularly with the size of the advertising pie shrinking since 2007 because of political instability, militant violence and economic recession, they say. Dunya, an Urdu station based in Lahore, has hired and fired five programming directors in the two years it has been on air, as has Samaa TV, a rival based in Karachi.
The frequency of failure has largely been due to poor business planning and mismanagement, managers say. "Investors tend to embark on projects with great enthusiasm but often without a workable business plan," says Zafar Malik, who has worked as executive producer at three news channels including Samaa. "In such cases, investors end up paying the price later and that's when you see one cycle after another of firing and hiring."
Even older media houses such as the Jang-Geo and Dawn groups, respectively the leaders in the Urdu and English news media, have suffered embarrassing reverses. Geo TV, easily the country's most popular cable network, tried and failed to launch an English news channel in 2007 to counter the launch in May that year of Dawn News by Pakistan's leading English newspaper publisher. The Geo management bailed out in January 2008 after the project failed to progress, and after a stand-off with the then military government caused the group heavy financial losses.
Ultimately, Dawn News has fared little better, managers say. Hit by poor advertising and surviving on subsidies from Dawn, its sister newspaper that was launched 63 years ago, the channel's management tentatively introduced a band of Urdu programming in February. After a positive response, the channel abandoned its core English identity altogether in May. Increasingly, international franchises are being seen as an attractive option for new market entrants, because of the brand power and transfer of expertise involved.
The Associated Group, Pakistan's leading producer of liquefied petroleum gas, has acquired the rights to publish Newsweek Pakistan, which is scheduled to hit the news-stands in October. Channel managers also said several investor groups are negotiating with CNN for a Pakistan franchise, while others are exploring a similar arrangement with Al Jazeera International. But the failing fortunes of Pakistan's oldest international franchise, CNBC Pakistan, launched from Karachi in November 2005, have already highlighted the fact that branding is no guarantee of commercial sustainability.
Industry experts say channel investors and managers failed to grasp that a lack of originality in content was the root of their problems. "What they are trying to do is top each other's programming and, essentially, they are copying each other," says Azar Sadiq, the president of the trade organisation Broadcast Engineers Society of Pakistan. "The viewer is not being enriched or catered to with unique content and that is reflected in weak business plans."
Despite the prohibitive cost and highly risky nature of the business, many new projects are in advanced stages of planning, channel managers say. Geo TV has begun hiring citizen journalists for a new news channel, the Express Group is working on plans for an entertainment channel, and both are expanding into FM radio, each with three stations. Veteran broadcast consultants are worried that many new entrants are making the same mistakes as their predecessors by paying highly inflated prices for radio licences.
"The sums just don't add up," says Azhar Hussain, an independent radio consultant based in Islamabad. "Investors think the media is the goose that lays the golden eggs but they don't know how it lays." email@example.com