Starlink Nigeria has placed new orders for Residential Internet kits on hold to force the hand of the Nigerian regulators to approve a price increase that had been previously reversed.
In October, Starlink, owned by tech mogul Elon Musk, reviewed prices for its product offerings by a staggering 97 percent. But the Nigerian Communications Commission (NCC) reversed the increment the following day, asserting that Starlink never received a go-ahead to change their prices.
Consequently, the commission initiated a pre-enforcement action against the Internet Service Provider.
Read also: Starlink suspends price hike in Nigeria over ‘regulatory challenges’
“We’re committed to providing high-speed internet in Nigeria and are working closely with regulators to make adjustments that will improve the customer experience,” Starlink Nigeria stated in a message to prospective customers on Tuesday. “Until these changes are approved, we are placing new Residential orders on hold,” the statement added.
Suspension as strategy to cower NCC
The suspension is deemed a calculated strategy to cower the NCC into allowing Starlink to increase the price of its product offerings, an approval that other telecom operators like MTN and Airtel have unsuccessfully tried for years to obtain.
The NCC has repeatedly resisted attempts by the telecom operators to significantly increase call and data rates. MTN said the company was running at a loss given their prices have not been altered to reflect skyrocketing inflation, subsidy-free fuel cost to run their facility and the naira’s helpless fall all of which beset the nation as it battles its worst economic crisis.
When Starlink Nigeria initially announced a price review, there were loud whispers that the government favoured Elon Musk’s Starlink over indigenous and existing telecoms operators who have long clamoured for the same price hike. But NCC shutdown the rumours with the pre-enforcement action that stopped Starlink from proceeding with the hike.
MTN Chief Financial Officer Modupe Kadri in October appealed to the government to reconsider its stance on the price increase, due to the high inflation and currency fluctuation.
Read also: Starlink suspends new kit sales in Malawi
“For 10 years now, telecommunication companies haven’t been permitted to increase prices, and this regulation is not providing us with a level playing field to operate,” Mr Kadri said.
MTN Nigeria’s CEO, Karl Toriola, warned that without an adjustment, it risks shutting down operations.
However, the operator recorded a significant overall loss of N514.9 billion for the nine-month period, mainly due to substantial foreign exchange (FX) losses, offsetting the Q3 profit.
Starlink pauses sales in Malawi after regulators opposed price hike
In an all too similar yet separate matter, Starlink announced halting sales of new kits in Malawi tentatively until after the regulators approve the price increment. Starlink, has paused the sale of certain business subscriptions and new residential subscriptions in Malawi. The suspension comes after a proposal to raise the subscription fee to reflect the depreciated Malawian Kwacha was rejected by the Malawi Communications Regulatory Authority (MACRA).