In 2008, Youtube was banned in Pakistan because of the videos made on the Muslim's final prophet "Hazrat Muhammad S.A.W" commonly known as "Prophet Muhammad". Those videos caused a huge uproar in nationwide and they demanded "Youtube" to remove that content. Because of their predefined rules and regulations, they were unable to do so, and because of the uproar, PTA (Pakistan Telecommunication Authority) was forced to block "Youtube" in Pakistan.
On many occasions after the incident, people have asked to re-open it, and infact its still a pending matter in court, but they have not reached to a conclusion yet. One of the officials of the current government had recently announced the removal of ban on "Youtube" but this has not taken place yet.
The question left is: "Do Pakistani use Youtube?" , and the answer is: "Of course do, either through proxy sites or some other sites who locally caches Youtube's content."
The government knows this, the PTA knows this, but they are not lifting the ban. Why? Maybe because this can worsen their position in religious circles, maybe because they are trying to show the world that they are the true Islamic individuals (when infact they are not even close. :) ) . The game is purely political. Yes Muslims don't like when people make fun of their prophet, but because of the uproar, that third-rated, maybe I should say tenth-rated movie which didn't have more than 2000 views became so famous that the views jumped up to hundreds of thousand.