Starlink, Elon Musk’s Space X-owned satellite internet service, is making significant moves in Nigeria, aiming to increase its user base by reducing prices and expanding distribution channels. The company is now offering a 20% discount on its kit, dropping the price from ₦378,000 ($378) to ₦299,000 ($299).
Additionally, Starlink has entered into a partnership with Jumia, Nigeria’s leading e-commerce platform. Despite having set sales targets of $12 billion in 2022, the company reported revenue of only $1.4 billion.
Starlink’s entry into Africa in 2023 promised to provide high-speed internet to remote areas, offering a 100Mbps download speed, approximately ten times faster than the average mobile internet speed in sub-Saharan Africa, where broadband penetration remains limited. While Starlink holds great promise for the African market, its adoption across the continent has encountered several challenges, including affordability and regulatory issues.
In its initial rollout in Nigeria, affordability has proven to be a significant hurdle. The cost of the Starlink kit, even with a 20% discount, remains beyond the reach of the majority of Nigerians, given that the average monthly salary is still below ₦124,000 ($124). Approximately 70% of Nigerians contend with poor internet speeds, with the average quality of internet connections in 2023 falling to just 10.9%.
Starlink has faced unexpected regulatory obstacles in Africa
Besides affordability, Starlink has faced unexpected regulatory obstacles in Africa. In South Africa, the government has banned the import, sale, and usage of the service, although some residents have found ways to circumvent these restrictions.
Similarly, Zimbabwe and Botswana have raised concerns, asserting that Starlink has yet to obtain the required licensing despite plans to launch in Q3 2023. In August, the Senegalese government arrested individuals for selling Starlink terminals without proper authorization.
However, in some African countries like Rwanda, Starlink has been deployed for educational purposes. Rwanda’s ICT Minister, Paula Ingabire, announced the launch of Starlink in 50 schools, offering students greater access to online learning opportunities, with plans to expand this initiative to 500 schools by the end of 2024.
To address these challenges and expand its reach in Africa, Starlink has formed a strategic partnership with the e-commerce giant Jumia for the sales and distribution of its kits. Jumia, with over 3.1 million active quarterly users, is a well-positioned partner to help Starlink navigate the African retail and merchandise landscape. The plan is to initiate sales through Jumia’s platforms and agents in Nigeria, with plans to expand to Kenya in the near future.
Currently, Starlink is licensed to operate in Nigeria, Mauritius, Mozambique, Sierra Leone, Rwanda, and Kenya, with plans to roll out its services in more African countries by the end of the year.