Ola,
Victoria from Techpoint here,
Here's what I've got for you today:
- NCC's regulatory misfire with Starlink
- Founders: The secret marketing weapon
- $312B reason Kenya wants Safaricom split
NCC's regulatory misfire with Starlink
The Nigerian Communications Commission (NCC) recently made headlines by announcing it would sanction Starlink for hiking its subscription prices in Nigeria without approval.
However, just hours later, the NCC withdrew the statement, saying it was issued by mistake. They didn’t clarify if Starlink had now received approval for the price increase or if it was simply a clerical error. In their retraction, they asked that anyone who had published the statement should take it down.
Starlink had raised eyebrows when it increased its monthly subscription fees in Nigeria by a massive 97%, bumping the standard residential plan from ₦38,000 to ₦75,000.
The company cited "excessive inflation" as the reason for the hike. The NCC, however, claimed that the price increase was unauthorised and violated sections of the Nigerian Communications Act, which gives them the power to regulate telecom tariffs.
Before withdrawing the statement, the NCC’s Director of Public Affairs, Dr Reuben Muoka, mentioned that Starlink had requested approval for the price change, but the Commission hadn’t made a decision yet. The sudden price adjustment surprised them, and they were ready to take action to ensure compliance with local regulations.
This situation has left many wondering about the impact on local telecom operators, who have been pushing for their tariff increases. Groups like the Association of Licensed Telecommunications Operators of Nigeria (ALTON) and the Association of Telecommunications Companies of Nigeria (ATCON) have been advocating for price reviews, given the inflation and rising operational costs.
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The timing of Starlink’s price hike is also significant, as Nigerian telecom operators have been warning about the financial pressures they face. They’ve even considered strategies like load-shedding to manage operations while waiting for the NCC to approve tariff increases.
Founders: The secret sauce in startup marketing
After Nord Motion dropped the Nord A3 and A9 on October 3, 2024, people on X (formerly Twitter) couldn’t stop talking about Nigerian car brands, especially Innoson Vehicle Manufacturing (IVM) and Nord Motion.
A lot of the debate was around why Innoson doesn’t seem to market its products much. Some thought it could be a deliberate strategy, while others suggested the founder might not understand the power of marketing. Honestly, I’m not sure, but it got everyone talking.
Interestingly, while reading Chimgozirim's latest story yesterday, I came across a quote from Princewill Akuma, Marketing Manager at emerchantpay: "You cannot have great marketing if the founder doesn't understand marketing."
That made me think — if Innoson isn’t pushing its cars like people are saying, maybe the founder is part of the reason. What do you think?
From Akuma's perspective, the founders set the tone for marketing. If they don't get it, the company’s marketing efforts won’t hit the mark. He shared some valuable marketing principles in Chimgozirim’s story, which I found really insightful. You can read all the deets here.
Kenya pushes to break up Safaricom's empire
Kenyan lawmakers are back at it, trying to get Safaricom, the biggest telecom player in the country, to separate from M-PESA, its super profitable mobile money service.
This push is tied to the reintroduction of the 2022 Information and Communications (Amendment) Bill, which aims to split Safaricom into two separate entities.
The goal? More regulatory scrutiny and less market dominance for the telecom giant. The bill didn't get much love last time it was in parliament, with only two lawmakers supporting it, but it looks like the conversation is heating up again.
If this bill passes, Safaricom would have to make M-PESA a standalone business, which they’ve been fighting against for a while now.
M-PESA is a cash cow with 31.3 million active users from March 2023 to March 2024, processing a whopping $312 billion (KSh 40.2 trillion) in transactions during that time.
So, it’s no wonder that Kenyan lawmakers and regulators are pushing for this separation — they believe it’s crucial for fair competition and better regulatory oversight.
Safaricom, however, is sticking to its guns, arguing that its integrated business model is what adds value for shareholders. Meanwhile, competitors like MTN and Airtel Africa have successfully split their telecom and mobile money services.
Safaricom's CEO, Peter Ndegwa, isn’t convinced that separating M-PESA would boost the company's valuation or meet its financial needs.
Plus, Safaricom is worried about a massive tax bill that could come from the split, which they estimate could hit KSh 75 billion ($582 million) — a number that’s even bigger than their net gain of KSh 52.48 billion ($407.24 million) from 2023.
On top of all this, the Central Bank of Kenya is pushing for the split to have more direct oversight of M-PESA transactions. Right now, the CBK manages M-PESA, while the Communications Authority of Kenya (CA) handles telecom operations.
In case you missed them
- Kenya’s authority to explore AI and machine learning to detect tax evasion
- CBN strengthens oversight of Nigerian banks abroad with foreign MoUs
- Regulator grants Access Bank provisional licence in Namibia
What I'm watching
- How Nigeria Destroyed Itself
- The Internet Will End Soon…
Opportunities
- Piggytech is recruiting a Senior Risk and Compliance Executive. Apply here.
- Kuda is looking for a Product Manager. Apply here.
- Quidax is hiring a Head of Growth and Partnerships. Apply here.
- Kuda is hiring a Senior IOS Engineer. Apply here.
- Meta is hiring software engineers here.
- Follow Techpoint Africa's WhatsApp channel to stay on top of the latest trends and news in the African tech space here.
Have a wonderful Wednesday!
Victoria Fakiya for Techpoint Africa.