Safaricom will now work with Elon Musk's Starlink to expand coverage.
Safaricom has made peace with Elon Musk’s Starlink after the telco’s parent firm, Vodacom, signed an Africa-wide deal with the US billionaire, allowing the Kenyan firm to resell satellite data and equipment from the tycoon’s company.
Safaricom had openly opposed Starlink’s operations in Kenya, warning of security threats of illegal connections and interference to existing Mobile Network Operators (MNOs) in a spat that even ended up in court.
Now, Safaricom will integrate Starlink's satellite technology for data relay into its mobile network to boost coverage in rural areas across Kenya and Ethiopia.
This is a departure from the rivalry that last year saw the company write to the Communications Authority of Kenya (CA), asking it to re-evaluate its decision to grant licences to satellite internet providers.
Under the new deal, Safaricom and Vodacom’s other affiliates, like Vodacom South Africa, Tanzania and Egypt, will also become authorised resellers of Starlink equipment and services.
“Vodacom will be authorised to resell Starlink equipment and services to enterprise and small business customers in Africa, while retaining the flexibility to create localised value propositions that consider the unique requirements and affordability of the African market,” South Africa-based Vodacom Group said in a statement.
Before Starlink entered Kenya in July 2023, Vodacom’s UK-based parent Vodafone had partnered with another US satellite internet company called AST SpaceMobile to enter the satellite internet market.
The deal sees Safaricom and the other Vodafone affiliates share revenue 50-50 with AST, with the parties agreeing to maintain mutual exclusivity in their markets.
Safaricom will continue working with AST SpaceMobile and other satellite connectivity providers even after the Starlink deal.
A senior official at the telco told the Business Daily that the company was yet to establish when the rollout would begin, awaiting official communication from Vodacom.
Starlink introduced better speed and competitively priced packages into the local internet market dominated by Safaricom, Jamii, and Zuku.
The American firm lowered hardware costs for Kenyan buyers from the initial Sh74,000 to Sh29,000 and also offered a kit rental option.
This saw Safaricom in July 2024 appeal to the CA, demanding that foreign satellite service providers be allowed to operate in Kenya only after establishing agreements with existing local licensees.
“Co-existence with mobile networks will not be possible and in the absence of effective management and co-ordination, satellite provided service will cause interference to mobile networks, which will ultimately adversely affect end users and related socio-economic benefits,” Safaricom said.
Court battles
Jamii Telecommunications, the second-largest ISP, also moved to court, terming Starlink’s pricing as predatory, while the legal lobby group Kituo Cha Sheria sued CA, accusing the watchdog of supporting Safaricom in the push to curtail Starlink’s operations in Kenya.
CA said it was relying on the United Nations International Telecommunication Union (ITU) to control satellite internet providers, citing the cross-border nature of their operations.
While CA did not publicly respond to Safaricom’s request, President William Ruto later praised Starlink's entry into Kenya, saying it generated competition and made existing players provide better services.
A month later, in October 2024, Safaricom said it was open to partnerships with satellite internet providers, including Starlink, to reach more remote areas.
"To the extent that we have places we have not covered, we should partner in the future with appropriate satellite providers, including Starlink," CEO Peter Ndegwa told the Business Daily then, citing a previous pilot program under the Vodafone-AST deal.
The Vodacom-Starlink deal comes as the Musk-owned firm’s uptake has slowed in the past year due to a November 2024 freeze on new subscriptions around Nairobi over a network capacity overload.
As of June, Starlink had 17,425 subscriptions, placing it ninth with 0.8 percent market share, while Safaricom expanded its dominance to 735,749 subscriptions with a 34.3 percent share.
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