Watching a monopoly sweat

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Now, let’s get into this week’s edition!

You don’t often see a monopoly sweat over new competition.

But every giant has its day.

Last week, Safaricom, East Africa’s biggest telco, was the talk of Kenya on X.

A leaked letter showed Safaricom asking Kenya’s tech regulator to block satellite internet providers from entering the market - unless they partner with local companies.

But what stands out more than the letter itself is the timing.

Just a day before, Starlink rolled out a rental option for Kenyans to get their kits for $15 a month instead of coughing up over $350 to buy.

Since launching in Kenya last year, Starlink has been steadily lowering its prices.

And because of these pricing moves, satellite internet users in Kenya jumped tenfold to 4,808 this year.

So, what’s all the fuss about satellite internet, and why is Starlink shaking things up in Kenya?

Millions of Africans are still offline

Africa’s tech future depends on getting more people connected.

To make that happen, we need to make smartphones and internet access easier for everyone.

But even in Kenya, one of Africa’s big tech hubs, 59.2% of the population is still offline.

That’s over 32 million people, mostly in rural areas with little infrastructure.

But it’s not just about getting access. It’s also about being able to afford it.

About 35% of Kenyans, or 18 million people, can’t afford even basic mobile internet.

And this clash of poor access and high prices is a big chance for internet providers to step up.

For a long time, this opportunity belonged to telcos.

They were the ones who built the infrastructure that made phone calls possible.

Then, when the internet came along, they teamed up globally to build undersea fibre optic cables to speed up data transfer.

This big investment paid off, and now Safaricom controls 37.4% of Kenya’s data market.

But as people demand faster and cheaper internet, their clock is ticking.

Could Starlink be the game changer?

Fibre internet got us from zero to one, but its limits are starting to show.

99% of Africa relies on cables, but just 5% of the world's underwater internet lines are found here.

And when any of these get damaged, we have limited cables to reroute internet traffic to.

In March this year, Africa had a massive internet failure that hit 13 countries.

Côte d'Ivoire, Liberia and Benin were hit hardest, while Ghana, Nigeria, Cameroon and South Africa faced mild disruptions

And in the past three months, Safaricom had two major internet outages because of undersea cable cuts.

One even hit during the height of the finance bill protests on June 25th, boxing Safaricom into a corner on social media.

Starlink says it could fix this.

It skips the need to lay cables in the ground or underwater and instead uses space satellites to deliver fast internet.

Which makes it perfect for areas where cables are tough and costly to lay.

Starlink can bring money to the fight

For a long time, Safaricom had two big things going for it—a huge network and a fat wallet.

Their fibre optic network stretches more than 14,000 km, and last year, they became the first in East Africa to hit $1 billion in revenue.

But now, Starlink is dealing with a powerful new hand and closing in fast.

SpaceX, which owns Starlink, has launched over 4,000 satellites in the last four years and has 6,146 working satellites in orbit.

Starlink is on track to hit $6.6 billion this year and has the money to throw at any bumps in the way.

Safaricom’s reaction — trying to get regulators to limit Starlink — shows they’re worried.

For internet users in Kenya, this fight is a good thing.

With competition heating up, prices may drop and quality could improve as everyone fights for market share.

Starlink also wants to bring satellite internet to phones.

But they still have some hurdles to clear.

They've been banned in Ghana and Zimbabwe, and some distributors were even arrested.

And despite Starlink being licensed in Kenya, we’re waiting to see if the regulator will pick up Safaricom’s call for help.

How do you see the battle for Africa’s internet playing out?

Let us know here.

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