Salve,
Victoria from Techpoint here,
Here's what I've got for you today:
- Starlink faces backlash over local ownership in Lesotho
- SA ditches smartphone tax for low-income users
- Paratus Group enters Tanzania
Starlink faces backlash over local ownership in Lesotho
Looks like Starlink is hitting some serious roadblocks in Southern Africa, this time in Lesotho. Just like in South Africa, where Elon Musk is fighting against the country’s telecom ownership rules, Starlink is facing pushback over local equity. A rights group called Section 2 wants Starlink to allocate 30% of its ownership to Basotho citizens before getting a licence to operate.
Section 2 took their concerns to the Lesotho Communications Authority, arguing that the licensing deal is unfair since there's no local ownership. They pointed out that other telecom providers in Lesotho, like Econet and Vodacom, have local shareholders; so why should Starlink be any different?
Right now, Starlink Lesotho is fully owned by Starlink Holdings Netherlands, with no Basotho involvement, which they say shuts out locals from benefiting.
Meanwhile, Musk has already made his feelings clear about South Africa’s telecom rules, calling them unfair and suggesting they discriminate against him because he’s “not black.” That issue has delayed Starlink’s launch there, and now Lesotho seems to be heading in a similar direction.
Despite these setbacks, Starlink has already gone live in other Southern African countries, including Eswatini, Botswana, and Zimbabwe. Namibia is next in line, with a launch expected later this year. But in Lesotho and South Africa, it’s looking like a waiting game.
Starlink’s availability map says Lesotho should get the service by 2025, but with this ownership battle brewing, that might change. For now, it’s a standoff between Musk’s satellite ambitions and local ownership demands, and we’ll have to see who budges first.
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SA ditches smartphone tax for low-income users
South Africa’s scrapping the 9% luxury tax on smartphones under R2,500 starting April 1, 2025. Why? To make smartphones more affordable for low-income households as the country phases out 2G and 3G networks by the end of 2027.
With more people needing 4G and 5G-ready phones, the government wants to help bridge the digital divide though critics argue it might not be enough.
Meanwhile, Finance Minister Enoch Godongwana has confirmed a VAT increase is coming. Instead of a sharp 2% hike, he’s spreading it out; 0.5% in 2025/26 and another 0.5% in 2026/27, bringing VAT to 16%. It wasn’t an easy call, but the government says it’s the best way to avoid cutting social spending. Oh, and don’t expect any personal tax relief. No inflation adjustments mean more of your income could be taxed as earnings rise.
To bring in extra cash, sin taxes are going up too. Expect to pay more for alcohol, cigarettes, and vapes, with hikes of up to 6.75% on some products. On the flip side, the government’s looking at adding more essential foods like canned vegetables and dairy liquid blends to the VAT-free list so there’s a tiny win for consumers.
The big question now: Will the Government of National Unity (GNU) sign off on all of this? The DA’s John Steenhuisen is already throwing shade on X, saying his party won’t back the budget in its current form. So, expect some heated debates before anything’s set in stone.
Paratus Group enters Tanzania
Paratus Group, an African telecommunications and network services provider, has teamed up with Tanzania's Green Telecom to launch Paratus Tanzania. This move comes just four months after they set up shop in Kenya, marking another step in their East African expansion.
According to TICGL, as of December 2024, Tanzania boasts 86.8 million registered SIM cards and 48 million Internet subscriptions, reflecting a 16% growth in just one quarter.
Martin Cox, Paratus Group's Chief Commercial Officer, is optimistic about the venture, highlighting the potential to enhance connectivity, especially in rural and underserved regions. However, it's worth noting that while 4G coverage stands at 88%, 5G reaches only 20% of the population, indicating room for infrastructure improvement.
Said Alli, Managing Director of Paratus Tanzania, sees significant opportunities across various sectors, including tourism, mining, and healthcare. The tourism sector, in particular, is experiencing a boom, with a 25% increase in visitors over the past year. Yet, despite these advancements, feature phones still dominate the market with an 87% penetration rate, suggesting that many Tanzanians may not fully benefit from enhanced connectivity services.
Green Telecom, launched in 2013, has a history of providing tailored solutions for managing and integrating clients' network services. Their collaboration with Paratus aims to leverage this expertise to address existing connectivity gaps. However, with regions like Dar es Salaam leading in mobile line subscriptions and infrastructure, a clear urban-rural divide needs addressing to ensure equitable access.
While Paratus's commitment to investing in infrastructure and expanding its network services across Africa is commendable, the challenge lies in translating these investments into tangible benefits for the broader population. As the digital revolution unfolds, ensuring advancements reach all Tanzania's corners will be crucial for inclusive growth.
In case you missed them
- Telkom Kenya secures $4.4M grant to bolster Open RAN deployment
- How Africa can leverage relations with Japan for growth
What I'm watching
- Why Organized Religion Makes No Sense
- Ricky Gervais Breaks Down Religion in 10 Minutes
Opportunities
- Pitch Friday is tomorrow, Friday. To attend, apply here.
- Interswitch is hiring a Senior Software Developer. Apply here.
- PalmPay is recruiting a Business Developer. Apply here.
- Standard Bank Group is looking to fill several positions across Africa. Apply here.
- Paystack is hiring for several roles. Apply here.
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Have a superb Thursday!
Victoria Fakiya for Techpoint Africa.
