Elon Musk-owned satellite internet provider Starlink has rolled out a cheaper data plan in Kenya, intensifying competition amongst established internet service providers in the country.
This development is poised to challenge the dominance of local giants like Safaricom and Airtel who have a strong grip on the market.
According to its website, Starlink unveiled affordable high-speed internet with 50GB of data for KSh 1,300/month, less than half of Airtel’s data plan for the same package (KSh 3,000). Safaricom’s monthly package of 45GB costs KSh 2,500.
Tekedia Mini-MBA edition 16 (Feb 10 – May 3, 2025) opens registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
Starlink wrote,
“Affordable, high-speed Internet with 50GB of data included for KSh 1,300/month (opt-in for additional data at KSh 20/GB). Now accepting mobile money (M-Pesa, Airtel)”.
According to the Communications Authority of Kenya, Safaricom currently commands a 63.7 percent market share of mobile broadband subscriptions, followed by Airtel with 31.5 percent.
Safaricom in particular has established a substantial market presence, largely driven by its mobile money service M-Pesa and extensive network coverage. Airtel, although not as dominant as Safaricom has also carved out a significant market share with competitive pricing and service offerings. Other internet service providers are Telkom Kenya with 1.8 percent; Finserve, Equitel with 1.5 percent and Jami Telecommunications also with 1.5 percent.
Following Startlink’s entry into the Kenyan market in July 2023, the satellite internet provider reduction in its Internet Price comes as the company aims to capture a part of the market long dominated by Airtel and Safaricom.
Notably, the Internet service which has been known for providing high-speed internet in remote and underserved areas worldwide, and now offering a lower-cost data plan, aims to make its services accessible to a broader segment of the population, including those who have been reliant on more expensive or less reliable options. This will likely intensify competition in the sector.
Possible Impact of Starlink Reduction in Internet Price on The Kenyan Telecoms Sector;
1. Price War: The introduction of an affordable Starlink plan is likely to trigger a price war. Safaricom and Airtel may need to revise their pricing structures to remain competitive, potentially lowering their profit margins.
2. Service Improvement: To retain customers, Safaricom and Airtel might need to enhance their service offerings. This could include improving network coverage, increasing data speeds, and offering better customer support.
3. Innovation: The competition could spur innovation, pushing Safaricom and Airtel to develop new products and services to differentiate themselves from Starlink. This could benefit consumers through better and more varied service options.
Notably, looking at the broader market implications, this disruption goes beyond just Safaricom and Airtel. It reflects the broader trend of increased competition in the African telecom market driven by the entry of global players.