Cell C plans to partner with LEO satellites for rural broadband expansion

South Africa’s fourth biggest mobile operator Cell C is exploring partnering with low-Earth-orbit (LEO) satellite providers for affordable broadband services, especially in rural areas, an executive said on Tuesday.

LEO satellites operate 36 times closer to Earth than traditional ones so they take less time to send and receive information, leading to better and faster broadband service even in remote areas.

“We’re having a number of discussions with the different providers to look at alternative connectivity,” Riaan Singh, Managing Executive for Strategy & Innovation at Cell C told delegates at a tech conference in Cape Town.

“The problem that we’re really trying to solve is trying to enable better connectivity, particularly in rural areas and also to drive power grid independence.”

On measures of connectivity, adoption and digital penetration, South Africa stands far ahead of the rest of Sub-Saharan Africa, according to the GSMA, an association representing mobile operators.

However, the cost of building and operating networks in the country remains high, particularly as a result of difficulties in accessing rights of way, the high cost of unreliable electricity and the impact of crime on network infrastructure.

Satellite-internet has become an alternative connectivity solution that telecom executives, governments and regulators across Africa can’t ignore amid the popularity of providers such as Starlink, operated by Elon Musk, on the continent.

Starlink, the satellite unit of SpaceX, operates in several African countries but has faced regulatory challenges in others such as South Africa and resistance from state telecoms monopolies.

In South Africa, the regulator ICASA is trying work out the regulatory and licensing framework for satellite-internet providers in order to provide clear rules for potential operators in the country.

South Africa is also grappling with how to manage foreign-owned global communications companies as such companies need to be 30% owned by historically disadvantaged groups if they want to operate in the country.

Last month, the Communications Minister Solly Malatsi said he would issue a policy direction to the regulator to amend the rule so that instead of selling a portion of the company, multinationals would have the option of entering into “equity equivalent” programmes, designed to fulfil the requirements of Broad-Based Black Economic Empowerment ownership. Reuters