BD Insider 201: Starlink’s 20% discount fails to make service affordable for most Nigerians

Johnstone Kpilaakaa -

Effective next month, South Africa and Ghana have inked a visa waiver agreement for individuals holding ordinary passports.

“Travellers may transit through, depart from and stay in the territory of both countries for a cumulative period of 90 days without recourse to work,” Ghana's ministry of foreign affairs said in a statement seen by Bendada.com.

This move will boost socio-economic activities between both African nations.

Last year, Kenya entered into a similar agreement with South Africa, and it took effect in January. South Africa has been cutting down visa restrictions with African countries which previously required travellers to provide proof of sufficient funds and return flight tickets.

In today's letter, we cover:

  • Starlink 20% discount for Nigerian users
  • the planned arrival of 2Africa cable in Nigeria
  • the ban on VPNs in Tanzania

The big three

The news: Elon Musk's satellite internet service, Starlink is extending a 20% discount to users in Nigeria who wish to acquire their hardware. This offer, introduced earlier this month, allows users to purchase the hardware kits for ₦299,500 ($386) instead of the original ₦378,000 ($487).

Starlink has specified that the discount will be available for “a limited time”. Meanwhile, the monthly service fee stands at ₦38,000 ($48.98).

Starlink order page showing the discount
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A few weeks ago, Jumia announced an agreement with Starlink, a satellite internet service, to retail the Starlink Residential Kit in Africa.

Why it matters: While Starlink delivers high-speed internet, boasting a download speed of approximately 150 Mbps, its cost remains a barrier for many Nigerians, who often opt for budget-friendly packages offered by local internet service providers.

Even with this price reduction, the majority of individuals in the country will still find it unaffordable. Almost two-thirds of Nigeria's 200 million people currently survive on less than $2 per day.

In June, the Nigerian Communication Commission (NCC) announced that it has initiated discussions with Starlink to lower the pricing of its services within the nation. “We are trying to engage them to bring the cost of their services down to affordable levels so people in rural areas can equally benefit from this important information. With time we hope the days of un-connectivity will be over with the satellite provision all over the country,” Umar Danbatta, the former CEO of NCC, stated.

The progress of the NCC's negotiations with Starlink remains uncertain.

Zoom out: Starting next year, Starlink has revealed its plans to introduce a service known as “Starlink Direct to Cell,” which will allow users to establish a direct connection to Starlink's satellites using their mobile phones.

While the precise operational details have not been disclosed by the company, the service may likely incorporate a cost-effective data bundle approach, commonly referred to as “sachetisation”.

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#2. Meta’s 2Africa subsea cable will arrive in Nigeria next month

The news: The 2Africa subsea cable, owned by Meta (formerly Facebook) and the 2Africa consortium, is on track to reach Nigeria in the coming month.

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The 2Africa consortium is made up of telecom operators China Mobile International, Bayobab (formerly MTN Global Connect), Orange, center3 (formerly stc), Telecom Egypt, Vodafone, and WIOCC.

This cable will arrive in two locations; Lagos and Qua Iboe, a riverine area in Akwa Ibom. Notably, this news follows the recent landing of the 2Africa subsea cable in the Democratic Republic of Congo, just a month ago.

Last year, the first 2Africa subsea cable on the continent arrived in South Africa.

What we know: “2Africa will deliver much-needed internet capacity and reliability across large parts of Africa, supplement the fast-growing capacity demand in the Middle East and underpin the further growth of 4G, 5G and fixed broadband access for billions of people,” reads a statement on the provider's website.

2Africa, one of the world's longest subsea cables at 45,000 kilometers, connects Europe (via Egypt), Asia (via Saudi Arabia), and Africa, with a design capacity of up to 180 terabits per second (Tbps), surpassing the total capacity of all existing subsea cables serving Africa.

Vodafone, a member of the 2Africa consortium, has announced that the project is expected to be completed by 2024. A study by RTI predicts that upon becoming operational, 2Africa could have a significant economic impact, with estimates ranging from $26.2 billion to $36.9 billion, equivalent to 0.42% to 0.58% of Africa's GDP, within two to three years.

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#3. Tanzania introduces mandatory permits for VPN usage

The news: The Tanzania Communications Regulatory Authority (TCRA) has mandated that individuals and companies who depend on Virtual Private Networks (VPNs) must disclose their usage and furnish the necessary details, including their IP address, to the authority by the end of this month.

TCRA says it has noticed an increased usage of VPNs in the country by users who want to access illegal content, hence the need for a VPN permit—which can be requested on or before October 30, 2023.

Non-compliance with this directive carries a penalty of Tsh 5 million ($2,000) or a minimum prison sentence of 12 months, the authority disclosed in a statement.

Opposition: This regulation has received widespread opposition in the country.

“TCRA's decision to limit the use of VPNs in Tanzania has far-reaching implications for the digital rights and freedoms of Tanzanian citizens,” the Tanzania Digital Rights Coalition, said in a statement. “VPNs play a crucial role in safeguarding online privacy, enabling secure communication, and granting access to information and services that may otherwise be restricted or censored.”

Know more: Tanzania's Electronic and Postal Communications (Online Content) Regulations of 2018 were repealed on July 17, 2020.

However, the law that succeeded it, the Electronic and Postal Communications (Online Content) Regulations of 2020, permits similar forms of detrimental internet censorship in Tanzania. This new legislation not only suppresses the freedom of expression for Tanzanians, curtails their access to information, and infringes upon their right to privacy but also grants the government the opportunity to benefit from an escalation in online censorship and control.

This legislation is what is backing TCRA's latest move to regulate VPN usage.

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VPNs have always been central to global politics of resistance in the age of the internet. In 2021, when the Nigerian government implemented a ban on Twitter, numerous Nigerians turned to VPNs as a means of boycotting the ban

💰 State of Funding in Africa

Last week, truQ, a Nigerian logistics startup, emerged as the winner in the first-ever TC Moonshot Battlefield by TechCabal, securing a ₦2.5 million prize. The second-place spot was claimed by Jamit, a social audio network, with ₦1.5 million.

Additionally, entertainment startups like Jamit which have been largely underfunded are about to receive a boost. Sony launched a $10 million fund to invest in seed to early-stage startups in Africa's entertainment industry, including startups in the gaming, music, movie and content distribution sectors. 

While we wait for the impact of this fund on the continent, find below the summary of how African startups jointly raised about $3.3 million last week.

📰 Noteworthy

Here are some of the important stories in the media:

  • Of internet depletion and expensive data plans: In Nigeria, the cost of mobile internet is high. However, poor network and data depletion remain a widespread problem for subscribers despite substantial plans.
  • Payhippo appointed a new CEO: YC-backed Nigerian fintech startup, Payhippo has appointed Dami Olawoye as its new chief executive officer. The outgoing CEO, Zach Bijesse will join the startup's board.
  • Kenya rejected Bolt? The Kenyan National Transport and Safety Authority have declined Bolt's licence renewal due to alleged violations of approved commission charges and booking fees.
  • In prison for TikToking: An Angolan social media influencer, known as Neth Nahara, has seen her prison sentence extended to two years for making derogatory comments about the country’s president on TikTok.
  • Another move to regulate social media in Nigeria: The National Broadcasting Commission (NBC) says it has sent a bill to the national assembly to enable it to regulate social media.

💼 Opportunities

We carefully curate open job opportunities in Product & Design, Data & Engineering, and Admin & Growth every week.

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Other opportunities

  • For healthtech founders: The Halcyon Fellowship has opened applications for founders at the MVP stage building innovative solutions in healthcare Apply by October 21, 2023
  • Interested in becoming a technical talent? The Nigerian Federal Ministry of Communications, Innovation & Digital Economy is accepting applications for its 3 Million Technical Talent Program. Learn more about the program.

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