What does Elon Musk's Starlink mean for Nigeria's telcos?

Jun 07, 2022|Adesola Afolabi

It is no secret that the IT & Telecoms industry is one of the few darlings of the Nigerian economy. While there’s very little data on Nigeria’s labour market, Jobberman’s analysis of more than 30,000 job listings and 1,000,000 job applications shows that the IT & Telecoms industry is one of Nigeria’s largest job creators.

Between July 2020 and July 2021, the sector accounted for 14% of job listings and 12% of job applications. By comparison, the oil sector accounted for 5% of job listings and 6% of job applications over the same time period.

Key takeaways:

The approval of Elon Musk’s Starlink in Nigeria is sparking several reactions from interest groups across the country. On the one hand, there are concerns regarding the level of disruption a competitor like Starlink will cause in the country’s vibrant telco industry. On the other hand, consumers suffering from poor internet connectivity are excited about the possibility of faster and better services. Yet, there are worries about affordability.
Still, there might be a market with for Starlink’s expensive service. Think, enterprises, industries and corporations, not necessarily people in the rural areas that Starlink hopes to capture.
However, if Starlink can attract such customers, telcos might still retain most of their revenue-generating customers, who are largely the masses. For instance, MTN Nigeria’s customer business unit generated revenues 13% larger than what its enterprise and wholesale business units generated in 2021.

That’s not too surprising, though, and you could argue it’s even welcome. Given the digital age we live in, a vibrant IT & Telecoms industry can indicate a country’s ability to harness opportunities for the modern economy. For instance, internet access has been a key driver to the growth of Nigeria’s entertainment and