Stop selling Starlink and cut customers off — Icasa’s warning to South African ISP

South Africa’s telecommunications regulator has demanded that a local Internet service provider (ISP) stop importing Starlink kits on behalf of its customers and cut them off from the satellite broadband service.

Northern Cape-based IT Lec received a letter from the Independent Communications Regulator of South Africa (Icasa) with the instruction on Monday, 14 August 2023.

“IT LEC (Pty) Ltd should, within three days of receipt of this letter, stop and refrain [from] acquiring, distributing and facilitating sale of any Starlink products in South Africa, that will in any form provide satellite access to the Starlink services,” the letter stated.

The regulator’s demand implied that IT Lec had to cease buying Starlink kits from other countries where the service was already live and cut off all Starlink services to its customers in South Africa from Thursday, 17 August 2023.

It follows discussions between the ISP and Icasa several weeks ago, in which the regulator sought clarity on the service.

It had repeatedly delayed meetings with IT Lec before eventually engaging and going quiet for weeks.

The ISP imported Starlink kits on behalf of thousands of its customers for several months.

It also manages their accounts with Starlink, but also allows them to take it over and deal with the company directly.

It charged R15,000 for the Starlink kit and R1,799 per month for the service.

Due to enormous demand, it was forced to temporarily pause new orders about two weeks ago.

IT Lec’s Starlink units in transit.

Starlink has not applied for a licence to operate its services in South Africa, and customers cannot order their kits from the company’s website directly.

However, the service works locally courtesy of its optional regional and international roaming features.

When Starlink first opened international pre-orders, South Africa had an estimated availability date of 2022. That was later pushed back to 2023, before being switched to “unknown”.

The delay was due to an Electronics Communications Act (ECA) requirement that historically-disadvantaged groups (HDGs) must own 30% of a company before it can get the necessary telecoms licences to operate a broadband service locally.

HDGs include black people, youth, women, and people with disabilities.

The ownership makeup of Starlink’s parent company SpaceX is very complex and includes numerous investment firms in addition to its biggest shareholder — CEO and founder Elon Musk.

According to Icasa, Starlink requires an individual electronics communications services (I-ECS) licence and possibly an individual electronics communications network services (I-ECNS) licence.

The latter would only apply if Starlink rolled out its ground stations — which provide backhaul Internet connectivity — in South Africa.

These ground stations, also called “Earth Gateways”, and the Starlink router have already received type approval from Icasa.

Starlink router

But according to Q-KON Africa group CEO and chief engineer for the Twoobii satellite service, Dawie de Wet, IT Lec was perfectly within its rights to offer its importing and managing service.

“Starlink operates a global constellation that will be available in all territories unless the services are specifically muted or barred in a designated area according to Starlink’s business policies, “De Wet said.

“The service will be available over the South African region, unless prohibited by the Starlink operational directives.”

“This is similar to all other past, current and future services delivered by satellite constellations.”

De Wet also said there were no issues relating to Starlink’s use of radio frequency spectrum.

“Frequency and service coordination between satellite operators is an ongoing effort and is resolved through the different working groups and service coordination teams,” said De Wet.

“All coordination aspects and any possible frequency interference are mitigated on an international level between the respective operators and is very seldom dealt with on a national or regional forum.”

However, De Wet did foresee potential issues around payment, tax, and corporate compliance regulations that must be considered.

“When Starlink scales to thousands of terminals, then the forex outflow [for Starlink equipment and monthly fees] would certainly need to be done through official channels,” said De Wet.

A potential blow to rural connectivity avoided

IT Lec primarily serves customers in deep rural areas, including those on remote farms, with few options for broadband connectivity.

Previously, many of its customers relied on MTN fixed-LTE packages for an Internet connection.

However, these customers have seen poor to non-existent coverage during load-shedding.

The Northern Cape is sparsely populated, so it would not make sense for a mobile network operator to invest heavily in the province — including backup power.

IT Lec also told MyBroadband that there were only two Vodacom and MTN technicians working on towers in one large remote area of the province.

Starlink performed better than fixed-LTE and was the ideal solution for many of IT Lec’s customers. The ISP described it at has a game-changer.

IT Lec had amassed over 2,600 sign-ups before it had to press pause due to overwhelming demand.

The ISP also told MyBroadband that Icasa’s letter contained several allegations and assumptions about Starlink that its legal team believed were incorrect — including the issue of type approval of the Starlink kit in South Africa.

While it is attempting to correct these issues with the regulator, it has devised a plan to avoid cutting customers off.

The ISP has opted to migrate them to a separate company registered in Mozambique, from where it plans to distribute Starlink kits to other African countries where the service is not yet available.

Mozambique is one of five African countries where Starlink has rolled out.

MyBroadband asked Icasa for comment on its instruction to IT Lec last week and its official stance regarding Starlink on multiple occasions but did not receive comment by the time of publication.

Now read: Why one undersea cable break can slow South Africa’s Internet to a crawl

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Stop selling Starlink and cut customers off — Icasa’s warning to South African ISP