Musk’s Starlink Wants to Connect South African Schools, But Not on South Africa’s Ownership Terms
Starlink offered $28 million to connect 5,000 South African schools, but a 30% ownership dispute stands in the way. Who should compromise?
Elon Musk is offering free internet to more than 5,000 South African schools, potentially benefiting 2.4 million pupils annually.
But his refusal to give up 30% of Starlink’s local ownership has sparked a bigger question: Is South Africa protecting economic equality or allowing its policies to stand in the way of digital education?
Because that is the controversy surrounding Elon Musk's Starlink and its attempt to enter South Africa's telecommunications market.
According to US Ambassador to South Africa Leo Brent Bozell III, Musk rejected a requirement to transfer 30% of Starlink's local ownership to historically disadvantaged investors.
The disagreement has raised an uncomfortable question: Should South Africa relax its ownership requirements to attract investment, or should foreign billionaires respect the country's efforts to address inequalities created by apartheid?
A $28 Million Internet Offer for Rural Schools
Starlink has proposed investing approximately $28 million (R500 million) to provide free satellite internet to more than 5,000 rural schools across South Africa.
The programme could benefit an estimated 2.4 million pupils annually, particularly in communities where reliable internet remains difficult to access.
Under the proposal, participating schools would receive Starlink equipment and broadband services without bearing the costs. South African companies would also participate in installation and maintenance.
For schools struggling with limited connectivity, the project could provide access to digital educational materials, online research and learning opportunities.
However, the investment proposal has become closely connected to a much bigger argument about business ownership.
Why Musk Reportedly Refused South Africa's 30% Ownership Requirement
South Africa's telecommunications licensing rules include requirements intended to increase economic participation among groups disadvantaged under apartheid.
Certain license holders must ensure that historically disadvantaged South Africans hold at least 30% of their local equity.
For Starlink, this requirement has been a major obstacle to obtaining the licenses needed to operate formally in the country.
During an interview with The Common Sense, Ambassador Bozell claimed Musk was unwilling to surrender part of his satellite-internet business.
"He said no, and he walked away from it," Bozell stated while describing Musk's reported reaction.
However, the ambassador did not confirm that he had discussed the matter directly with Musk. His account should therefore not be treated as a verified, direct quotation from the billionaire.
Interestingly, Bozell referred to connecting 500 schools, whereas Starlink's documented proposal covers more than 5,000.
The disagreement has sparked debate over whether South Africa's ownership requirements protect economic inclusion or discourage international companies from investing.
Starlink Offers Investment Instead of Giving Up Shares
Rather than transferring ownership, Starlink has proposed meeting South Africa's Black Economic Empowerment requirements through an Equity Equivalent Investment Programme (EEIP).
This approach would allow qualifying companies to contribute towards economic transformation through approved investments instead of transferring equity.
In a June 2025 letter to Trade, Industry and Competition Minister Parks Tau, said thatStarlink argued that it was not seeking special treatment or exemption from South Africa's empowerment policies.
Instead, the company proposed investing in rural connectivity, education and local businesses while retaining ownership of its South African operation.
The starlink's senior director for market access, Ryan Goodnight, explained the company's position:
"If EEIPs are recognised for individual licence holders, Starlink would immediately apply for its necessary licences in South Africa."
The statement suggests that Starlink is willing to invest in the country but wants an alternative route to satisfying its empowerment obligations.
For supporters of the proposal, providing internet to thousands of schools represents a practical contribution to economic development.
Critics, however, may question whether infrastructure investment should replace policies designed to give historically disadvantaged South Africans ownership stakes in major businesses.
South Africa's Government Faces a Difficult Decision
The South African government has already taken steps towards recognising equity-equivalent investments in the communications sector.
In December 2025, Communications Minister Solly Malatsi issued a policy direction calling for such investments to be recognised when assessing empowerment requirements.
Malatsi argued that the approach could attract investment, improve broadband access and support economic transformation.
The government also maintained that the policy was not designed specifically for Starlink.
This distinction matters because South Africa must balance two important objectives.
On one hand, the country wants to attract technology companies capable of improving internet connectivity, particularly in underserved communities.
On the other, its empowerment policies seek to address the economic inequalities that continue decades after apartheid ended.
Starlink has expanded into several African countries, offering satellite internet in areas where traditional telecommunications infrastructure is limited.
Yet South Africa remains a major potential market where the company has not secured the licences required for formal operation.
The controversy is therefore about more than Musk refusing to give up 30% of a business.
It is also about whether investment in schools, infrastructure and local companies can deliver the economic empowerment that ownership requirements were designed to achieve.
And while the government and Starlink debate the conditions for entering the market, thousands of rural schools remain potential beneficiaries of an internet programme that has yet to materialize.