SpaceX’s Starlink is edging closer to bringing its satellite internet services to South Africa, but it faces a significant regulatory hurdle that could delay its launch.
The company, led by billionaire Elon Musk, has filed a submission with the Independent Communications Authority of South Africa (Icasa), urging the regulator to reconsider its 30% local shareholding requirement for foreign satellite operators.
The regulation, which is part of South Africa’s broader framework for the electronic communications sector, mandates that companies providing services directly to end users must have at least 30% ownership by “historically disadvantaged” South Africans.
SpaceX has argued that this requirement could exclude foreign operators like Starlink, which are keen to invest in the country but have global policies that prevent them from meeting local shareholding rules.
In its submission, SpaceX proposed an alternative: the recognition of equity-equivalent programs. These programs would allow companies to meet the empowerment requirements by contributing to initiatives that benefit disadvantaged communities, rather than solely through equity ownership.
SpaceX believes this change would not only attract foreign investment into South Africa’s growing ICT sector but also support innovation, competition, and long-term economic growth.
The push for reform comes at a time when South Africa is seeking to expand its broadband coverage, especially in underserved areas.
The government’s SA Connect program aims to bridge the digital divide and ensure that more South Africans have access to reliable internet. Starlink, with its satellite internet service, could play a significant role in this effort, especially given its global track record of providing high-speed, low-latency internet in remote areas.
However, SpaceX’s concerns highlight a broader issue in South Africa’s regulatory environment. While the country has made strides in improving its ICT infrastructure, the current ownership requirements for satellite services could create barriers for emerging technologies and foreign investments.
In a rapidly evolving digital landscape, industry leaders are calling for policy reforms that would enable greater participation from global players like Starlink, who are ready to contribute to the country’s digital transformation goals.
The upcoming Icasa public hearings in February 2025 will offer an opportunity for stakeholders, including SpaceX, to present their views on the proposed changes to the licensing framework for satellite services.
The regulator’s decision will be crucial in determining whether South Africa can unlock its full potential as a hub for satellite internet services, which could bring reliable and affordable connectivity to millions of people, particularly in rural and underserved areas.
With international investors eager to play a role in South Africa’s digital future, the country’s regulatory environment may need to evolve to accommodate the new realities of the global tech landscape. Whether Icasa will heed SpaceX’s call for regulatory flexibility remains to be seen, but the outcome of the public hearings could shape the future of satellite internet services in South Africa for years to come.