The Nigeria’s Telecom Grand Debate: GSM-Led or Satellite-Led As Elon Musk’s SpaceX Starlink Arrives

The Nigeria’s Telecom Grand Debate: GSM-Led or Satellite-Led As Elon Musk’s SpaceX Starlink Arrives

The generation’s finest innovator is coming to Nigeria with his product. Yes, Elon Musk and SpaceX are already in Abuja working with the industry regulator, Nigerian Communications Commission (NCC), for permits to pipe broadband via satellite, bringing a new domain in the ICT space in the country. I have called that an “asymmetric disruption” because it offers a new order to what the terrestrial players like MTN, Glo and Airtel offer. In 2017, I wrote an article titled “2022 – Africa’s Year Of Affordable Broadband Internet And Immersive Connectivity”. That seems to be on the money!

In today’s videocast, I make a case that Africa will enter the era of affordable broadband internet in 2022. That will be the year we will begin a new dawn of immersive connectivity where you can eat and surf all you can. Industry players will take off the Internet meter and then focus on service, experience and quality. From satellite broadband vendors to the MNCs with balloons and drones, the sector will become very competitive and service will drive growth. This has happened in the past – every decade, Africa experiences a major industrial transformation. We saw that in banking and voice telephony. 2020s, starting at 2022, will be the decade of immersive connectivity.

People, the game is changing and customers have a promise ahead – better quality at lower price. As that happens,  we will see how the telco industry body lobbies: expect a new dimension of bank-led and telco-led mobile money debate to resurface, but now GSM-led and satellite-led broadband connectivity in Nigeria. Yes, would telcos expect SpaceX Starlink to come into the open party just as they have expected the Central Bank of Nigeria (CBN) to allow them to join the mobile money redesign in Nigeria. The argument was that telcos would improve the mobile money customer experience, better than banks, due to their better distribution outlets. 

But here, since Starlink is coming from satellite, I do think it has a huge chance to also improve the experiences of customers on broadband connectivity, unbounded and unconstrained by the usual terrestrial challenges.

People, everything will be tested and it all depends on what the regulator does with SpaceX, because if you allow Starlink carelessly, these telcos will fade. The telcos which have made a case for mobile money, that the government should allow the best to win, have an opportunity to tell Nigerians if they truly believe in a totally free market system in our telecommunication sector.

SpaceX team in Nigeria

But this is what I expect the telcos to say: the Nigerian telecom sector should be GSM-led, and not Satellite-led, and by that, even if SpaceX Starlink comes, it must be mandated to pipe its data through partnerships with GSM-based broadband providers. The telco lobby will argue for protecting jobs and investments. It would be a fierce one.

Elon Musk’s SpaceX Starlink Arrives Nigeria, Meets NCC for Permit

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4 thoughts on “The Nigeria’s Telecom Grand Debate: GSM-Led or Satellite-Led As Elon Musk’s SpaceX Starlink Arrives

  1. Awopetu Emmanuel · Edit

    In a direct mail I sent to you on the 4th of April- last month, during the USSD clash, I gave insight and the content read:

    My View on MTN Nigeria recent crisis: This pain point would lead to the next phase of telecommunication in Africa with Nigeria as the first point. It’s becoming obvious that there would be a global disruption in that sector and the only way these players can have a grip of market share is when they come together in unity and partner like the banks did.
    Taking lesson(s) on success(es) of FinTech’s in the country, it’s obvious that they couldn’t have won without the traditional and regulatory bodies giving them licenses and the needed support to make this giant’s stride, so, extrapolating this would mean that Starlink -Elon musk initiative- or any of such who consider having a market here now or in the nearest future should have this tradition players in a partnership. The banks are in a win-win situation at the moment because even if the telco’s do not use their service directly, they still make commission because they are the back-bone of this innovation
    The USSD clash goes beyond what many can see, there is need for foresight by players in this niche not just cost saving methods to boost revenue by executives.

    For your Information: Starlink is the brain child of Tech billionaire, Elon musk, with this he seeks to make internet accessible to all. With it first point of installation being Makah Indian reservation a remote area in Washington D.C. This innovation which is highly welcomed by resident of the region who have been in need of a strong internet service provider for their livelihood, also air their pain that although this product is satisfactory it’s expensive (Initial cost). The unemployment rate of the region is double digit and the resource to purchase and maintain this kind of gadget is unavailable to the average.

    So, this comes with implications that Starlink would have hard times breaking into certain market territory as their product would be seen as luxury regardless of the value they offer. To the end, I foresee other space technology start-up coming into the scene which would be triggered by the shortage in supply of semi-conductor in the global supply chain (semi-conductor production has become a priority in the investment agenda of most countries, and this rain of cash would lead to ambitious tech entrepreneur seeking way to tap into the disruption to come.)

    Valuable Insight: Although the banks cannot be totally sidelined presently because they provide the support structure upon which this digital business conduct their affairs. It would be an awesome moment when this budding eaglet don’t need traditional players in the scene, rather just them and the regulatory bodies. This is thought pattern is founded on the indications seen presently- Flutterwave, Opay, Carbon, etc. as a means of payment.

    The premise of my thought was that the telco should stand in unity and route out plans just like the banks- BVN, Fintech. This would help them escape quick extinction.

    But the race for the rural region has just gained acceleration, with this it would easy for data and intellectual property to be gathered and value extracted, so I expect firm like Bankly, to have a surge in VALUATION in no time. If Nigeria leads well in this, drafting out policies which would make it easy for this firm to thrive without being exploited or exploiting citizen and robbing local players of market share it would increase FDI into the continent because manufacturing firms should be forced to make their smartphone gadgets here. The untapped market for digital product is still large and that valued unused, which could account for the progress of the nation.

    Reply
    1. “So, this comes with implications that Starlink would have hard times breaking into certain market territory as their product would be seen as luxury regardless of the value they offer. ” – Starlink may not have to worry about that. In US, the US government is paying it to provide broadband to rural America. In Africa, Netflix, Disney, etc may pay it to make easier for Africans to buy their products. The challenge for telcos is that American tech can converge on Starlink. That was what they did in India’s Jio when all invested to make access largely free for all

      Reply
  2. Awopetu Emmanuel · Edit

    Angle- Yet we are saying the same thing because in the latter part of that statement, I made mention that their would be heavy cash flowing into that sector to tap into the value there- “To the end, I foresee other space technology start-up coming into the scene which would be triggered by the shortage in supply of semi-conductor in the global supply chain (semi-conductor production has become a priority in the investment agenda of most countries, and this rain of cash would lead to ambitious tech entrepreneur seeking way to tap into the disruption to come.)”

    Reply

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