Internet service provider (ISP) Herotel is targeting an additional one million South African homes in the next two years, expanding its footprint to 1.6 million homes.
So said Van Zyl Botha, CEO of Herotel, in an interview with podcast channel ITWeb TV, highlighting the ISP’s future growth trajectory.
Botha joined ITWeb TV on the heels of telecoms regulator the Independent Communications Authority of South Africa (ICASA) finalising the licence transfer application of Herotel to Vumatel.
During the interview, the CEO spoke about the company’s beginnings of aiming to be the “small town hero” providing unlimited connectivity to South African households, growing its presence to more than 500 towns, aspirations to enter the mobile virtual network operator (MVNO) space, as well as the country’s broadband connectivity prospects.
He also touched on the operational challenges that come with rolling out connectivity in some areas.
Herotel began its journey in 2013 as a consolidation strategy for the fixed-wireless industry, to ensure existing network infrastructure is used to get everyone connected. Unlike providers that rely primarily on third-party networks, it builds, owns and operates its own fibre and wireless infrastructure − a model it says has helped it scale rapidly across the country.
In 2022, fibre operator Vumatel indicated plans to acquire a 45% non-controlling stake in Herotel, with the regulatory process finalised recently.
Botha said completing the shareholder transaction bodes well for Herotel’s ambitions to connect “a lot” more people very soon.
In terms of the current footprint, the ISP has passed 600 000 homes and connected about 10 000 businesses. It also has a wireless network that connects about 50 000 customers, which is everyone outside of fibre reach where there is no other product available.
“We want to grow that [homes passed] by another million,” he said. “If everything goes well – it’s a complicated process to get wayleaves and deal with local government – but I’d say in the next two years.”
While Vumatel has come onboard, Botha indicated the strategy is for Herotel to remain as its own brand and operationally autonomous.
“We don't see a lot of change in Herotel. We want to align to group policy, and our shareholders are listed companies, so there’s a lot that we must put in place. I think for the next three years, the companies must continue what they’re doing until everyone in South Africa is connected. Then there’ll be a next phase when everyone is connected… [of determining] what other digital products, services to supply to our customers.”
In South Africa, there are officially 17 million homes: four million are in the leafy suburbs, and 13 million in townships. Only six million are recorded as been connected, which leaves a lot of homes without any connectivity.
“For the rest of the country, if you look at where we [Herotel] are, you can assume that anything adjacent to us or within our reach, in the next two or three years those people will have fibre at home,” Botha said.
In the case where some areas are sparsely populated, he said this is where low-Earth orbit satellite solutions may come in. “But everyone that’s close to backhaul and close to an electricity grid, we can build fibre to them.”
Beyond being an ISP looking to connect more South African households, Herotel also recently did a proof of concept with a SIM card, which it plans to call Herotel mobile.
“We’ll run it as an MVNO. A lot of our customers ask for two things: they ask us for mobility and for TV. We’re doing a proof of concept with Herotel mobile, so you can have WiFi or fibre at your house and at your office. You can only use your SIM card in between and it’s not your primary source. If you can reduce that then you’ll save money. We think Herotel mobile can be a good product.
“We’ve also done a telehealth trial, allowing you to see a doctor over the phone. Once people are connected to fibre, we see a lot of digital products we can roll out, including safety and security. If you can put up cameras, you can monitor and keep a community safe.
“We’re always on the lookout for other technologies,” he stated, noting there are some things in the pipeline which will be announced at the right time.
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