Kenya’s Communications Authority (CA) has introduced a proposal to significantly increase the 15-year licensing fees for satellite Internet providers (ISPs) from $12,302 to $115,331.
The new rules also include an annual levy of 0.4% of gross turnover, further raising the operational costs for providers like Starlink.
These changes are critical for Kenya’s digital landscape as demand for high-speed Internet is surging, especially in underserved and rural areas where satellite ISPs play a crucial role.
However, the proposed fees risk dampening this progress, as smaller ISPs, such as Viasat and NTvsat serving under 1,000 users combined, may struggle to absorb the financial burden, potentially slowing the rollout of much-needed connectivity in remote regions.
While the CA’s proposal aims to ensure fairness and regulate the growing satellite ISP market, the higher fees could inadvertently limit competition and innovation.
Small and medium-sized ISPs, essential to expanding Internet access in remote areas, face the risk of being priced out of the market. This could leave underserved communities with fewer options and perpetuate the digital divide.
Despite these challenges, the proposal includes progressive elements, such as allowing satellite ISPs to engage in terrestrial cable operations, telemetry, and even space research. This expanded scope could attract more investment into Kenya’s tech ecosystem, enabling companies like Starlink to establish ground stations and improve service quality.
Starlink, owned by Elon Musk’s SpaceX, has quickly established itself in Kenya’s market since its June 2023 launch. By offering affordable and high-speed satellite Internet, Starlink grew its subscriber base to over 8,500 users in just over a year. The service has been instrumental in bridging digital gaps, providing connectivity in areas beyond the reach of traditional telecom infrastructure.
However, local players like Safaricom, which has over 350,000 fixed Internet users through its fibre network, see satellite ISPs as both competitors and potential disruptors.
Safaricom had earlier urged the CA to mandate partnerships between satellite providers and local mobile operators, arguing that independent operations by companies like Starlink pose security risks and weaken local accountability.
Kenya’s regulatory approach highlights the tension between fostering innovation and maintaining market oversight. Stricter rules could safeguard local players and ensure compliance, but they risk stifling competition and slowing the spread of high-speed Internet to regions that need it most.
As the CA finalises these changes, stakeholders must consider policies that promote both accessibility and sustainable business operations for ISPs. Striking this balance will be key to ensuring Kenya’s digital transformation benefits its entire population.
Source: https://techpoint.africa/2025/01/08/kenyas-telecom-regulator-hike-satellite-isp-licensing-fees/