The Fall of a Giant: Safaricom’s Descent Into the Abyss Amidst Growing Competition from Starlink and Public Outrage

For years, Safaricom has reigned as Kenya’s telecommunications behemoth, a symbol of innovation and market dominance. But the winds of change are fierce, and Safaricom’s once unassailable position is now under siege.

The recent decision to block payments to Starlink, Elon Musk's revolutionary satellite internet provider, via its ubiquitous M-Pesa platform has sparked a wave of public outrage, amplified by a consumer movement demanding accountability. This corporate misstep is but one symptom of a deeper malaise, exacerbated by Safaricom’s controversial role during the #GithuraiMassacre on 25th June 2024, when the company cut off internet access as Kenya Police descended on Githurai, on the outskirts of Nairobi, following the historic #OccupyParliament protests, to brutally suppress protests against the Finance Bill 2024. Two months later, many residents are still missing, presumed dead. Meantime, Safaricom’s grip on Kenya is loosening, and the consequences will redefine the country’s digital landscape.

Safaricom’s Slippery Slope: The Starlink Controversy

Safaricom's decision to cancel M-Pesa payments to Starlink has ignited a firestorm of criticism, with the Consumer Federation of Kenya (Cofek) leading the charge.

Cofek's stern warning to Safaricom CEO Peter Ndegwa is a clear signal that consumers are no longer willing to tolerate what they see as corporate pettiness and anti-competitive behaviour. Safaricom’s move to block Starlink payments is perceived as an attempt to stifle competition, protect its market share, and maintain its monopoly over Kenya’s internet services.

However, this strategy seems to be backfiring. Starlink, with its promise of high-speed, low-latency internet accessible from virtually anywhere, presents a formidable challenge to Safaricom’s dominance.

While Safaricom struggles to maintain its grip on the market, Starlink has effortlessly garnered support and goodwill from Kenyans by providing a solution to Kenya’s long-standing internet issues without spending a single shilling on advertising. Its technology is a game-changer, allowing users to connect to the internet via satellites, bypassing the need for traditional ground infrastructure. "Mambo ya undersea cables hatutaki kuskia tena," opined one frustrated SafaricomPLC customer. "Starlink is the solution." (We no longer want to be told about undersea cables as an excuse for poor service delivery.)

Starlink’s integration of standard LTE/4G protocols means that users don’t need new phones or apps to access its service. This ease of use, combined with the superior speed and reliability of Starlink’s internet, has already started to attract disillusioned Safaricom customers. The promise of global coverage without the need for expensive ground-based infrastructure is particularly appealing in remote and underserved areas where Safaricom’s services have been historically unreliable.

Safaricom’s Reputation Crisis: The #GithuraiMassacre

The Starlink payment controversy is just one of the many issues Safaricom is grappling with. The company’s reputation took a severe hit during the #GithuraiMassacre, a dark chapter in Kenya’s recent history. On the night of 25th June 2024, as thousands of Kenyans protested against President William Ruto's draconian Finance Bill 2024, Safaricom abruptly cut off internet access, effectively silencing the voices of dissent. This blackout facilitated a brutal police crackdown that left scores dead and many more injured.

This incident has sparked widespread outrage, with many accusing Safaricom of colluding with the government to suppress free speech and human rights. The massacre has become a rallying cry for those demanding greater accountability from both the government and corporate entities. Safaricom’s role in this tragedy has not only alienated its customer base but has also drawn the ire of international human rights organisations.

The fallout from the #GithuraiMassacre continues to haunt Safaricom. The company’s attempts to distance itself from the incident have been largely ineffective, as public trust erodes. The perception that Safaricom is more interested in protecting its profits and political alliances than serving the needs of its customers is a narrative that is gaining traction.

Safaricom’s Strategic Missteps: A Monopoly Under Siege

Safaricom’s recent actions suggest a company that is struggling to adapt to a rapidly changing market. The rise of Starlink and other competitors like Jamii Telecommunications and Zuku has exposed Safaricom’s vulnerabilities. Where Safaricom once thrived on its ability to innovate, under CEO Peter Ndegwa it now seems to be clinging to outdated strategies that no longer resonate with consumers.

The company's monopoly over Kenya’s telecom and internet services is being challenged on multiple fronts. Starlink’s ability to provide faster and more reliable internet at competitive prices is a direct threat to Safaricom’s market share. The fact that Starlink can operate without the need for extensive ground infrastructure only adds to its appeal, particularly in rural areas where Safaricom’s services consistently fallen short.

The backlash against Safaricom’s decision to block M-Pesa payments to Starlink is symptomatic of a broader dissatisfaction with the company’s perceived arrogance and disregard for consumer choice. As more Kenyans turn to alternative providers, Safaricom’s market share is likely to continue its decline.

The Consumer Rebellion: Demanding Accountability

The Consumer Federation of Kenya’s (Cofek) warning to Safaricom is just the beginning of what could be a larger consumer-led rebellion against the company. The public’s frustration with Safaricom’s monopolistic practices, coupled with the anger over its role in the #GithuraiMassacre, has created a perfect storm of discontent. Social media is awash with calls for consumers to switch to Starlink and other providers, and the hashtag #BoycottSafaricom is gaining momentum.

Political leaders, too, are beginning to weigh in. Murang’a Governor Irungu Kang’ata’s criticism of Safaricom’s unreliable internet speeds and his endorsement of Starlink as a superior alternative underscore the growing political will to challenge Safaricom’s dominance.

Kimilili MP Didmus Barasa’s call to end monopolies and support competitive alternatives like Starlink further highlights the shifting tide.

The Future of Kenya’s Digital Landscape

Safaricom’s future is uncertain. The company’s ability to weather this storm will depend on its willingness to adapt to the new realities of the market and address the legitimate concerns of its customers. However, the combination of public outrage, political pressure, and increased competition from innovative players like Starlink suggests that Safaricom’s days of unchallenged dominance may be coming to an end.

If Safaricom is to survive, it must undergo a profound transformation. This means not only embracing new technologies and business models but also rebuilding trust with its customers. Safaricom must prove that it is capable of more than just protecting its bottom line—that it can be a responsible corporate citizen that values the rights and needs of the people it serves.

As Kenya’s digital landscape evolves, consumers will have more choices than ever before. The fall of Safaricom may not be the end of the story, but rather the beginning of a new chapter in which competition, innovation, and consumer rights take centre stage. In this new era, companies that fail to adapt and put their customers first will find themselves on the wrong side of history.

The decline and imminent fall of Safaricom is a cautionary tale of what happens when a corporation becomes too comfortable in its dominance. The backlash over the M-Pesa-Starlink controversy, coupled with the company’s tarnished reputation following the #GithuraiMassacre, signals a significant shift in Kenya’s telecom industry. Safaricom, once the titan of the sector, now finds itself on unstable ground, its future uncertain as consumers and competitors alike challenge its reign. This moment is not just a reckoning for Safaricom but a pivotal point for Kenya’s digital future. The lessons learned here will shape the next phase of Kenya’s technological evolution, where transparency, competition, and consumer empowerment must lead the way.