• Aggressive rollout and intense competition will ease world-high prices in Africa
Image: HOPE MUKAMI
A year after the introduction of commercial-scale satellite Internet by Elon Musk’s Starlink in Africa, significant developments are beginning to reshape the continent's Internet landscape.
Cheaper and faster Internet is increasingly available as satellite infrastructure rollouts expand and competition among providers intensifies.
In May, Liquid Intelligent Technologies, a major Internet player with a presence in 14 countries in Africa, partnered with OneWeb to expand Internet access to remote areas promising to offer better connectivity, using both low Earth orbit and traditional satellites.
“This strategic move anticipates the expected surge in new LEO satellite constellations over the next three years, providing agile and cost-effective solutions for entering and expanding markets,” Liquid Intelligent Technologies CEO Ahmed El Beheiry said at the time.
Direct competition between foreign satellite Internet providers, regional and domestic fiber and mobile network operators (MNOs) is shaking up of local Internet service provision.
It is also driving strategic partnerships between satellite Internet providers and MNOs for mobile satellite data provision.
Despite these intertwined competitions and collaborations, providers share a common goal: to improve Internet access by offering high-speed and cheaper data to customers.
African countries with some of the most expensive data plans in the world are currently witnessing most of these developments as more foreign satellite Internet providers gain a footing through strategic partnerships with local Internet service providers.
British firm Eutelsat OneWeb, which forms part of the French Eutelsat Group and runs a network of low Earth orbit satellites, has been making inroads into Africa by expanding satellite infrastructure and bolstering capacities of local Internet service providers.
Countries that will benefit from anticipated cheaper data costs include Botswana, DR Congo, Mauritius, Rwanda, South Sudan, Zambia and Zimbabwe. Liquid Intelligent also has a presence in Kenya, Nigeria and South Africa.
In early July, Zimbabwe government-owned telecom service provider TelOne entered a strategic partnership to leverage OneWeb’s satellites through a reseller arrangement to offer high-speed Internet to its customers at lower market prices.
“We will introduce flexible pricing models to remain competitive,” local media outlet Newsday quoted TelOne CEO Lawrence Nkala as saying.
“If we need to give discounts on certain products, we will do so, so that we remain in the game.”
The decision came barely a month after the announcement of Starlink’s projected third-quarter 2024 launch in Zimbabwe.
According to UK-based price comparison website cable.co.uk, as of September 2023, Africa is home to some of the 10 most expensive Internet data offerings in the world.
Zimbabwe has been listed as the most expensive in the world, with a price of $43.75 for 1 GB of data, followed by Saint Helena ($40.13), South Sudan ($23.70), the Central African Republic ($ 10.90) and Zambia (US$ 8.01).
In the region, the average cost of 1GB is $3.31, which is higher than the global average of $2.59.
Since 2019, prices per 1GB have dropped significantly, however. Prices in Zambia dropped by 256 per cent, in Central Africa Republic by 80.6 per cent and in Sudan by 71.6 per cent.
Northern Africa is the cheapest region in the world overall, according to the report, with average cost of 1GB at $0.86. All countries in this region are cheaper than the global average.
While Elon Musk’s Starlink has been saddled by regulatory hurdles to make inroads in a number of African countries, it has also been shaking up markets where data prices are cheaper on the continent.
In Kenya, Starlink has introduced a 50GB monthly data plan priced at $10 (Sh 1,300) compared to Airtel Kenya’s $23.4 (Sh3,000) and Safaricom’s $19.5 (Sh 2,500) for a 45GB plan.
“Affordable, high-speed internet with 50GB of data included for Sh1,300/mo (opt in for additional data at Ksh 20/GB,” Starlink stated on its website.
The $0.15 (Sh20/GB ) plan is lower than North Africa’s $0.86 average, reflecting the positive impact of satellite Internet in the Kenyan market.
Starlink also allows Kenyan users to pay for the data plans via mobile money services offered by Airtel and Safaricom.
The only competitive advantage the MNOs have is the relatively high cost of acquiring hardware for the satellite service. While the MNOs' satellite service will ride on existing registered sim cards, one requires Sh45,500 to install Starlink hardware.
The Communications Authority of Kenya’s Sector Statistics Report Q3 FY 2023-24 show the number of 100Mbps to 1GBps users (the highest speed range for Internet data in Kenya stood at 4,504 by March 2024) has increased to the the highest ever since since the launch of Starlink in July 2023.
“The utilised satellite capacity increased remarkably following the launch of Starlink’s high-speed, low-latency satellite Internet in the country,” the report states.
The regulator’s data showed that between December 2023 to March 2024, Kenya’s Satellite bandwidth grew from 0.44GBps to 48.4GBps.
Starlink’s significant success in Africa is in Nigeria, where the country’s communication regulator has already ranked it as the third-largest Internet service provider by subscriber base.
As of the end of 2023, Starlink had 23,897 active customers in Nigeria, less than a year after its launch in January 2023. This number is closing in on the 27,000 active users of Nigeria’s second-largest provider, FiberOne. The country’s largest and oldest ISP, Spectranet, had 113,869 active customers.
While such competition is hottest in urban centres, MNOs are collaborating with satellite Internet providers to cover remote parts of the continent.
In December 2023, giant telco MTN announced a multi-partnership arrangement with a number of satellite providers to test standard and direct-to-device satellite services.
MTN announced plans to conduct pilots with Lynk Global in Ghana and South Africa, negotiate tests with AST SpaceMobile in Nigeria and South Sudan, and conduct enterprise-focused trials with Starlink in Rwanda and Nigeria.
Similarly, Safaricom and other Africa operators from parent company Vodacom Group are also eyeing entry into mobile data satellite services through a collaboration with AST SpaceMobile.