Safaricom is aggressively pushing 5G in rural Kenya to take on Starlink

Telco has slashed prices for routers and targeted fibre-dark areas to reclaim ground upcountry.

Safaricom quietly increased its efforts to counter Starlink, by expanding the 5G rollout to rural Kenya. This is the market that the satellite internet provider (ISP), was built to serve. In the last six months, Safaricom has launched tens new sites in areas that were previously not on its broadband map. Safaricom’s teams are targeting users in the upcountry with affordable, plug and play 5G routers that come with flexible data plans as well as branded giveaways such as free t-shirts.

Five customers in Western Kenya have told TechCabal Safaricom salespeople are in the area since January and are pitching them the 5G router. Paminus Osike is a new user from Kenya’s Nyanza Province. “They signed me in two minutes,” he said. “Starlink’s cost is too expensive, and I love that this connection isn’t fixed but I can move with it,” said Paminus Osike, a new user in Kenya’s Nyanza province. The sales team who signed him up sold power banks for KES 5, 000 ($39) so customers could stay connected while on the go.

A small cybercafe owner told TechCabal he compared Safaricom 5G routers with rival devices and chose Safaricom because of its faster speed and higher data allocation.

Safaricom wants to reclaim the ground that traditional ISPs failed to deliver and where Starlink gained early momentum. This is a shift in Safaricom’s focus from urban areas to low-average revenue-per user (ARPU).

Starlink launched its service in Kenya in 2023 in order to connect areas that were not covered by mobile broadband or fibre. By the end of 2024, Starlink was the seventh largest ISP in Kenya, with more than 19,000 active subscribers, mainly located in remote counties such as parts of the Rift valley, where broadband coverage is patchy.

Safaricom proposed regulatory changes in 2024 targeting satellite providers. The company argued that licensing entities with no physical presence left the government little control. Safaricom has now shifted its focus to price and wider access, as the Communications Authority did not take up the proposal.

Starlink has seen a surge in demand in urban areas, despite a pricing model that does not favor cheaper, pay as you go purchases. It halted new signups in Nairobi due to limited capacity. The network provides the same bandwidth, regardless of population. Therefore, busy areas quickly reach performance limits.

Safaricom has responded by doubling fibre speeds and introducing gigabit plans in order to meet the growing demand for urban services. It is positioning itself as an alternative to Starlink in rural areas and cities where Starlink has failed.

Prices will be cut to coincide with the expansion of rural areas

In Kenya’s rural areas, people don’t have enough money for internet services. Many people are price-sensitive, and cannot afford routers. They are seen as a luxurious item. Safaricom’s strategy to make 5G accessible to these communities by offering low-cost devices and flexible payment options is a part of its overall strategy to make it more affordable.

Safaricom’s new 5G offering challenges Starlink in terms of hardware and flexibility. Routers are now sold for KES 3,00 ($23), down KES 25,00 ($192), and coincide with the rural expansion.

The Routers fall back to using 4G when 5G doesn’t exist. Some are sold door to door, with M-PESA options, similar to the sales tactics used by solar system companies. Monthly plans start at KES 4,500 ($31) and go up to KES 10,500 ($77) for a 250 Mbps plan.

Starlink’s basic mini kit is priced at KES 27,000 ($208), and its standard kit is priced between KES 30,000 and KES 45,000 ($231 to $347). Monthly plans are fixed between KES 1,300 (10 dollars) and KES 6,500 (50 dollars), depending on the tier. The cost of roaming and mounting is increased and flexibility is limited.

Safaricom has accelerated its rollout rather than waiting to see what Starlink will do. It is actively building out 5G and lowering costs. It also uses familiar mobile infrastructure to reach a larger number of users. Safaricom provides a local, practical alternative to Starlink’s ground stations.

Telco refused to disclose how many users use its 5G Routers. Telcos in Africa are shifting

Telcos in Africa are pushing back on Starlink’s low cost entry model. In Zimbabwe, Nigeria, and Cameroon operators accuse Starlink of unfair competition because it has not invested heavily in cables and towers. In Zimbabwe, Liquid Home had to lower its prices, TelOne teamed up with OneWeb and in Nigeria, Starlink became the third largest ISP in less than two years. Safaricom uses its mobile network in Kenya to promote 5G, especially in areas that are underserved. It has 1,114 5G locations in 102 towns, covering all 47 counties. This is about 14%. More than 780,000 5G phones are active and more 11,000 enterprise customers use its 5G service.