Starlink Suspends New Kit Sales and Subscriptions in Malawi Due to Currency Pricing and Regulatory Issues; Similar Problems in Nigeria

Starlink has suspended the sale of new Residential Subscriptions and some Business Subscriptions in Malawi.

The suspension follows the Malawi Communications Regulatory Authority (MACRA)’s rejection of a subscription price increase to match the devalued Malawian Kwacha.

An attempt to sign up for the Starlink service from Malawi will result in this message from the company:

We’re committed to providing high-speed internet in Malawi and are working closely with regulators to make adjustments that will improve the customer experience. Until these changes are approved, we are placing new Residential orders on hold. Place a deposit now to reserve your Starlink and you will receive a notification once orders resume.

The Malawian Kwacha is about 2600 to the dollar on the black market and 1700 on the official market. As a result, there are not enough US dollars on the official market to pay for subscriptions to the US company.

A source in Malawi that Techzim spoke to said that the only remaining package is Business 2TB Priority priced at MK190,000/month. New Business 40GB and 1TB Priority Plans have also been suspended.

The source also told us that existing Subscriptions are unaffected for now, but that since this only occurred today, it remains to be seen what the implications will be for existing customers.

Generally, Starlink’s objective is to charge about $50 for the Standard Residential subscription across Africa. However, local currency value loss means that in places like Malawi and Nigeria, subscribers end up paying much less USD value (the equivalent of about $25 right now in both countries when they pay in local currency).

Indeed, Starlink had a run-in with Nigeria’s telecoms regulator just last week after a price hike was rejected, forcing the company to reverse it. Nigeria is, of course, a much larger economy than Malawi, and one in which Starlink is incentivized to compromise.

Given that currency value distortions are common in Africa, it will be interesting to see how this situation develops in the two countries.

In Zimbabwe, such a situation will start to happen if Starlink Authorised Resellers, TelOne and Aura, start accepting payment in local Zig currency at the official government rate. So far, we have seen no sign that they are ready to do this. It may also become an issue if Starlink is unable to repatriate subscriptions paid in USD to its resellers.