Charles Nyezi is a businessman and owner of an internet café in Nquthu, a small rural community in northern KwaZulu-Natal, South Africa.[hidepost=9][/hidepost]
Nquthu has a growing industrial and commercial sector, located at an intersection of local provincial roads, and it is therefore in a strategic position for growth, especially as a service support hub.
But even though investment is flowing in fast, one of the greatest problems and challenges for the people of Nquthu remains a lack of access to basic information via the internet. None of the major telecommunications and internet providers are interested in this hard to reach, poorly serviced and seemingly unprofitable area, as is the plight of almost all of rural South Africa.
To run his internet café, Nyezi had only two options: dial-up or satellite internet – out-dated, extremely expensive and impractical technologies. He was forced to use satellite internet, the lesser of the two evils.
However, an innovative South African internet company, called Jenny Wireless, had a solution to Nyezi’s frustrations. Jenny Wireless allows its franchisees to establish internet service provider businesses through building their own wireless networks.
The business model is simple: Franchisees invest in a wireless tower and other infrastructure. Revenue is generated by providing internet and telephone services to end-users such as farmers, mines, wildlife parks, businesses, low-income households and government institutions. Each tower has a range of up to 50km and franchisees can add as many towers as they wish. Jenny Wireless handles all the billing and administration duties remotely.
Jenny Wireless was started by two brothers, Werner and Rolf Stucky. “We saw a gap in the market for rural wireless internet and backed that up with good systems and support,” says Rolf.
In order for Nyezi to start his own wireless network, he needed help. He didn’t had enough capital to set up his own tower. “A fate shared by so many talented and previously disadvantaged businessmen in these isolated communities throughout South Africa,” explains Rolf Stucky.
Additionally, land rights were complicated by the fact that Nyezi needed the support of the local chiefs and councils for use of any land in the area, as this is part of the Zulu Kingdom.
A local dealer for Mercedes-Benz came to Nyezi’s rescue. The company has an Enterprise Development Fund that supports projects that help create employment, economic diversification and education. The dealership agreed to invest R200,000 (US$26,000) in the project.
Jenny Wireless helped Charles scout out the best site for a tower, and they found it on a hill about 9km away from the centre of Nquthu.
The chosen site was on tribal land, so Nyezi needed the permission and blessing of the entire community. “I had to do the spadework, which was first to approach the chief, then a meeting with him and the Ndunas, then finally with the Ndunas and the community.”
He finally got the approval and after a traditional ceremony to appease the ancestors, Nyezi was given the go-ahead. He paid for the use of the land, and started the construction of a tower that would supply the area of Nquthu with wireless internet.
Technically it was a difficult project, as the tower needed to maintain an uninterrupted signal with another tower 85km away in the town of Newcastle, which would give it access to fibre. The area is full of hills and valleys.
In December last year, the tower finally went up. “The equipment was installed and everybody in the community held their collective breaths as the equipment was connected, dishes were aligned, and the rig was powered up,” notes Rolf Stucky.
Nyezi seems thrilled with the results. “Before I went to Jenny, I had to use a normal dial-up line, and it was so frustrating, slow and expensive. Then we moved over to satellite, which was even more expensive and did not really solve any problems. Now I can get eight times more data at a far greater speed and a much lower cost. You can’t even compare the two.”
“The tower in Nquthu works like a dream,” says Rolf Stucky. “With just a R200,000 investment they were able to set up a wireless network that will give full internet access to potentially thousands of people, more than 150 schools, hundreds of growing business, farms and holdings in the area.”
“We see rural telecoms not as a social responsibility but as an investment because our franchisees can make profits in these underserved areas. This is a far better motivator for getting more people connected,” he added.