The Nigerian Communications Commission (NCC) recently retracted an earlier statement threatening enforcement measures against Starlink, an internet connectivity provider, concerning its recent hardware and monthly subscription price increases. Dr. Reuben Muoka, the NCC’s Director of Public Affairs, initially shared the Commission’s position but later withdrew it, stating, “Please ignore my response above. My statement was an error of assertion.”

Despite the retraction of direct enforcement threats, the telecommunications regulator indicated that Starlink’s unilateral price review still holds the potential to erode the regulatory stability of the industry. Last week, Starlink significantly increased its hardware price from N440,000 to N590,000, marking a seventy-four per cent increase. Concurrently, the Elon Musk-owned company also announced an almost one hundred per cent increase in its monthly subscription; for instance, the Standard (Residential) package escalated from N38,000 to N75,000. In an email to subscribers, Starlink attributed these price hikes to “excessive levels of inflation.”

The NCC noted that Starlink’s decision to unilaterally adjust its subscription packages upwards did not receive the required approval from the Commission. According to the NCC, the company “jumped the gun by announcing price changes after filing a request to the Commission seeking approval for a price adjustment for which the Commission was yet to communicate a decision.” This action contravenes Sections 108 and 111 of the Nigerian Communications Act, 2003, and the agency’s license conditions concerning tariffs. Section 108 grants the NCC authority to regulate telecom tariffs, dictating that no licensee can impose charges without NCC approval. Similarly, Section 111 stipulates that the Commission shall prescribe and enforce appropriate financial penalties upon any licensee who exceeds duly approved tariff rates.

This is not the first time Starlink has adjusted its prices in Nigeria, demonstrating a floating price regime. After its official launch in Nigeria in January 2023, where prices were initially quoted in dollars before being converted to naira, the company reduced its hardware price by 21% in October 2023, from N378,000 to N299,000. By February 2024, the router was selling for N378,000. An increment regime in early March saw the price jump to N800,000, largely in response to the rapid depreciation of the naira to as high as N1900 to a dollar. When the naira appreciated to N1230.61/$ on the official window in April, Starlink slashed the hardware price to N440,000 before its most recent increase.

While it remains unclear if these price adjustments are replicated across other markets or are unique to Nigeria, industry experts have voiced concerns. Diseye Isoun, an expert in African broadband development, suggests that Starlink’s service may become a luxury accessible only to high to middle-income earners. Isoun noted that the number of Nigerians who can afford Starlink remains very slim, positioning the satellite company to primarily serve a “middle to rich upper-class Nigerian market” and businesses, as the significant costs for device acquisition and monthly subscriptions compete with other essential expenses like school fees and holidays.