Musk’s Starlink snaps up market share in Nigeria amid African push

Elon Musk’s Starlink satellite internet service is making significant strides in Nigeria, where it has emerged as the second largest internet service provider (ISP) by customer numbers just two years after its launch.

A recent report by the Nigerian Communications Commission (NCC) reveals that Starlink had 65,564 subscribers in September 2024, up nearly threefold from 23,897 users at the end of 2023.

In contrast, market leader Spectranet had 105,441 active subscribers in Q3 2024, experiencing a decline of over 8,000 users since December 2023. FiberOne, the country’s third-largest player, had 33,010 customers in the third quarter of last year.

Sadiq Mohammed, a Lagos-based telecoms data analyst, notes that incumbents in the fixed broadband sector have not been able to adequately meet the needs of Nigerian homes and businesses, creating huge unmet demand for fast and reliable internet.

“Users don’t want to experience internet downtime during critical zoom meetings or when they are streaming their favorite (TV) programs. With Starlink, the experience is consistent in terms of speed and reliability,” he tells African Business.

Nigerians willing to pay more

Accessing Starlink in Nigeria costs significantly more compared to local alternatives. However, Mohammed does not view this as a barrier to adoption, noting that Nigerians are “willing to pay more for what works well and what is accessible to them.”

He notes that a standard Starlink kit in Lagos retails at N590,000 ($387), with delivery adding about N32,000 ($21), bringing the total entry cost to N620,000 ($407). In comparison, entry prices for fixed wireless solutions such as LTE/5G, which consists of a home or office router and customer premises equipment from MTN or Airtel, ranges from N20,000 ($13) to N80,000 ($52).

“Fiber options typically range from N50,000 ($32) to N100,000 ($62). That’s 8% to 16% of Starlink’s entry price,” he points out, adding that fiber remains the best alternative to Starlink in terms of speed, but that its widespread adoption is hampered by infrastructure gaps.

“Fiber to the home and office remains the premium choice in terms of speed, capability, and performance. However, last mile fiber penetration is low, even in bustling urban locations like Lagos,” he says.

Aggressive expansion

Besides Nigeria, other key African markets for Starlink include Kenya, Mozambique, Rwanda and Malawi. The company, which is currently active in 19 African markets, plans to expand to 15 additional markets in 2025.

Starlink has, however, encountered roadblocks in South Africa, the birthplace of its billionaire owner Elon Musk. Despite protracted negotiations, the South African government has been reluctant to grant Starlink a license. Pretoria insists that the firm must cede at least 30% equity in its local unit to ownership by black people, women, youth and people living with disabilities – a requirement for any telecommunications company seeking a license in the country.

Starlink’s aggressive push in Africa has been met with mixed reactions. While some have praised it as a game changer for a continent facing significant gaps in internet coverage, critics charge that Starlink enjoys an unfair advantage over local telcos and ISPs due to its limited investments in local network infrastructure and its owner’s deep pockets.

“I would agree with the critics in this case. Starlink does not actually invest in local infrastructure. Aside from ground stations that act as connection points to local internet exchanges, there’s no other physical presence in the countries where they are licensed to operate,” Mohammed says, noting that this contrasts sharply with local telcos and ISPs, which directly contribute to job creation and economic growth through investments in offices, capital equipment and local operations.