Elon Musk’s satellite internet service, Starlink, has announced a significant increase in its monthly subscription fees for customers in Nigeria. The price has jumped by 97%, moving from ₦38,000 to ₦75,000. Additionally, the cost of Starlink kits, which include the necessary hardware to access the service, has risen by 34%, going from ₦440,000 to ₦590,000 for new users.
Starlink, which began operations in Nigeria in January 2023, has previously adjusted its prices for hardware multiple times. However, this marks the second increase in monthly subscription fees since the service launched. In a message sent to Nigerian customers, the company cited “excessive inflation” as the primary reason for the recent price hikes.
Starlink’s Message to Customers
In an update to its subscribers on Tuesday morning, Starlink confirmed that the new subscription rates would take effect for current customers on October 31, 2024. For new customers, the price change is immediate. The message stated:
“Due to excessive levels of inflation, the Starlink monthly service price will increase from current rates to the respective rates below: Standard (Residential): ₦75,000; Mobile-Regional (Roam Unlimited): ₦167,000; Mobile-Global (Global Roam): ₦717,000.”
The company reassured current customers by adding, “If you do not wish to continue your service, you can cancel at any time.”
Growing Popularity in Nigeria
Despite these higher costs compared to local internet service providers (ISPs), Starlink has generated considerable interest among Nigerians eager for better internet services. The unique capability of Starlink’s satellite service to reach areas with limited or unreliable internet access has made it an appealing choice for many.
According to data from the Nigerian Communications Commission (NCC), Starlink is rapidly gaining traction in Nigeria. As of the fourth quarter of 2023, the company has become the third-largest ISP in the country, boasting approximately 23,897 customers. This number is particularly noteworthy considering many local ISPs that have been operating for years have fewer customers.
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Background on Starlink’s Pricing Strategy
Starlink first announced its service in Nigeria in January 2023, but Nigerians had begun pre-ordering its hardware as early as 2022. Initially, the company quoted prices in dollars, with the hardware costing $600 and the subscription priced at $43. However, upon its official launch, these prices were converted to Nigerian naira.
When Starlink first entered the market, the hardware was priced at ₦268,584 and the monthly subscription at ₦19,260, based on an exchange rate of about ₦450 to $1. However, as the value of the naira fell, the prices adjusted, leading to increases throughout 2023.
In late 2022, Starlink reduced its hardware prices by 21% to attract more customers. The hardware was sold for ₦299,500 during this promotional period but later returned to the original price of ₦378,000 in mid-November. Earlier this year, the price of the hardware briefly spiked to ₦800,000 before settling at ₦440,000, which remained until the recent increase.
Customer Reactions
As Starlink continues to adjust its pricing, customers and potential users are left to weigh the benefits of the service against the increasing costs. While some may choose to cancel their subscriptions due to the new pricing, many remain optimistic about the potential of Starlink to provide reliable internet access in Nigeria, especially in underserved regions.
Overall, Starlink’s latest price hike highlights the challenges and complexities of providing satellite internet services in a market affected by inflation and currency fluctuations.