Successful 2020 for iWay - further growth forecast

In the 2020 financial year, revenue at Internet service provider iWay grew from CHF 30.5 million in the previous year to CHF 34.5 million. Revenue growth thus increased from 12 percent in 2019 to 13 percent in 2020. The company's most important business areas also recorded the highest growth rates: the Internet Access segment grew by 18.5 percent to CHF 19.8 million, which corresponds to a 59 percent share of total revenue. With Internet telephony (Voice over IP) and TV services, iWay generated 8.3 million francs (plus 16.1 percent) or 25 percent of sales in the past fiscal year. The workforce grew from 48 to 50 employees. This relatively moderate growth reflects the ongoing drive to digitize and automate business processes. "At 13 percent versus 10 percent, we were able to significantly exceed the budgeted growth last year. In particular, the growth in Internet connections for both fiber and xDSL lines is very pleasing in view of the highly competitive market," says Markus Vetterli, Managing Director of iWay. To a certain extent, the Covid 19 pandemic also contributed to the growth: "We were able to see that we are systemically relevant as an Internet provider. This is because the demand for larger bandwidths has risen again due to the increased shift to the home office, homeschooling and more TV and streaming consumption among private customers," says Vetterli.

More performance for the same price

iWay is now responding to this customer loyalty with a nationwide adjustment of speeds and prices: "We are immediately increasing the bandwidths for the products and reducing subscription prices. This means our customers get more performance for the same or lower price," says Vetterli. For example, a subscription with 1000/1000 Mbit/s upload and download speeds now costs 59 francs a month. For the 10-GBit/s subscription, iWay is even lowering the price from 99 to as low as 69 francs. The prices apply to both new and existing customers. Importantly, these prices are not time-limited. "We are harmonizing our portfolio in cities with fiber optic networks, but also across Switzerland for fiber and XGS-PON connections," says Vetterli. Both existing and new customers will therefore benefit from these service and price adjustments. Furthermore, products can be tested free of charge for one month at iWay. This is because customers in the B2C sector are very willing to switch, especially when it comes to TV, as Vetterli explained at a media conference.

Virtual-ISP coveted sales model in lockdown

As expected, the partner business again proved to be significant for iWay's success in the past fiscal year. Thus, sales via indirect distribution grew from 16.9 to 17.6 million Swiss francs (plus 4 percent) in 2020. The automated ordering process for resellers in particular proved to be a business model in demand during the pandemic. While pure sales partners generate additional revenue for their company with referral commissions, wholesale partners can act as providers (Virtual ISP) to their customers. "The ability for IT companies to sell Internet and TV services to their customers in their own name and order them from the comfort of their home office on our partner portal has made things easier for many partners in the lockdown," says Vetterli. Virtual ISPs do not have to sign their own contracts with Swisscom or city networks. iWay also takes care of background handling for them, such as shipping preconfigured routers, invoicing and support services on behalf of the partners. This process optimization, which has already been tried and tested over three years, has not only enabled the company to increase its revenue via partners, but also to further expand its wholesale partner network from 171 in 2019 to 214 companies.

iWay launches new products

For enterprise customers, iWay now has the option of a telephony connection to the Microsoft Teams communications solution. Many companies have recognized how well the functionalities of these video conferencing solutions can also be used for telephony, provided that they invest in the necessary voice add-on from Microsoft, says Dejan Crvenkovic, who is responsible for the corporate customer business at iWay. For smaller companies with more basic requirements, the connection is made via a session border controller hosted by iWay. Each Teams user is assigned a phone number and can use it to make and receive calls. In addition, Teams offers a small PBX feature set by default. For companies with more complex telephony solution needs, VPBX offers a comprehensive range of PBX functionalities and maximum flexibility in addition to the connection to Microsoft Teams - even in mixed operation with desk phones, mobile clients and Microsoft Teams users. Other new products for corporate customers relate to offerings for split-second detection of interruptions in fiber or DSL connections and automatic takeover of the route by a secondary line via 4G/LTE.

Outlook for 2021: iWay expects further growth

For the current financial year, Vetterli expects growth in the high single-digit percentage range. This is because increasing price pressure and a certain negative effect following the pandemic are likely to make the same strong growth in the access area as in previous years less likely. On the other hand, Vetterli expects clear double-digit growth in Voice-Over-IP in the business customer environment and in TV offerings. Cybersecurity is also becoming increasingly important. iWay also confirms an increase in DDOS attacks since the outbreak of the Corona pandemic, but considers itself well equipped in this regard. Among other things, the IP addresses of iWay customers are constantly monitored by external cybersecurity service providers, so that open ports or poorly secured servers can be quickly detected and customers informed accordingly.

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