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WISPs and their role in the connectivity economy

Average revenues for Internet service providers (WISP) who responded to the Wireless Access Provider’s Association (WAPA) survey (76% of all members) exceed R3-billion, employing 2 785 people and serving more than 200 424 home and business customers.

The vast majority, 94%, are either majority black-owned or level 4 broad-based black economic empowerment (B-BBEE) certified.

“They make noteworthy contributions to the economy, creating jobs, and serving the needs of South Africans,” says Paul Colmer, exco member at WAPA. “With more spectrum for fixed wireless Internet, which is faster and easier to deploy than wired services, they could achieve even more.”

He adds that the majority of WISPs are micro enterprises and 63% have annual revenues in the R2-million to R20-million brackets. By contrast, just 5% generate more than R50-million in revenue per annum and 8% between R20-million and R50-million.

Overall, the sector has shown substantial growth. In 2013, 80% of WISPs in South Africa generated R1-million to R5-million in annual revenues, according to WAPA’s study.

In 2013 WISPs contributed around 3% of the sector. This has grown to 12% market contribution in seven years.

They deliver a sizeable portion of the telecommunication sector’s fixed Internet and data R26-billion annual contributions noted in ICASA’s 2020 report on the state of the ICT sector in South Africa.

According to ICASA’s report, “Total fixed Internet and data revenue increased by 40,4% from R19-billion in 2018 to R26-billion in 2019. Revenue from fixed (wired)-broadband services increased by 26,5% for the same period.”

Colmer adds: “The vast majority of WISPs are entrepreneurs, owner-operated businesses that employ many thousands of people and provide services to millions of people in South Africa.

“Supporting WISPs to deliver fixed wireless Internet is an opportunity to create employment, provide services, and improve the fiscus.”

He says the numbers are significant when correlated with static high site numbers. In 2013 WISPs owned and rented a total of 5 480 high sites around the country while in 2021 the number is 5 705.

“WISPs are clearly ambitious in how they deliver services, employ people, and generate revenues as demonstrated by rising median revenues compared with a lack of coverage growth, most likely due to low new spectrum allocations and the difficulties that presents in making affordable connectivity feasible,” says Colmer.

Source: IT-Online