The premise
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Elon Musk is getting much pushback over his post on X (formerly known as Twitter) about Starlink not being allowed to operate in South Africa. The now-viral post itself quotes another post about race-based laws in South Africa, reads: “Starlink is not allowed to operate in South Africa, because I’m not black.”
Pushbacks
There has been a lot of pushback from South Africans, with many mentioning that so many other American companies operate in South Africa in compliance with local laws. Many are pointing out Microsoft’s latest announcement of any massive investment in their AI/data centre operations in South Africa.
Is Elon lying or exaggerating?
The truth is that Starlink has been trying to enter the South African market since its global expansion started. South Africa should have been its first African market. Not necessarily because Elon was born in South Africa or holds South African nationality but because South Africa’s internet ecosystem is easily the most developed in Africa. The stumbling block to Starlink is a regulatory requirement that telecommunications companies must allocate 30% equity ownership to “historically disadvantaged groups” such as Black people, women, youth and people with disabilities.
This stems from one of South Africa’s Black Economic Empowerment (BEE) policies, which the telecoms regulator Independent Communications Authority of South Africa (ICASA) enforces under the Electronics Communications Act.
Where is Starlink?
Starlink has not complied with this requirement nor applied for a licence to operate in South Africa. Conversations with the South African government have been held to find a way around these requirements with “equity equivalents” like skills development programmes, but there has been no concrete progress on the subject matter.
So, is Elon Musk not black enough for Starlink to operate in South Africa?
Well, that’s an interesting way to put it, but his post was not far from the truth. SpaceX owns Starlink. SpaceX is not publicly traded, and the ownership structure is not public, but according to available data, Elon Musk owns about 42% of SpaceX. The current ownership structure does not comply with South Africa’s BBB-EE laws.
