I'm going to put my hand up and say I have absolutely no idea how an ISP works. He runs cables to each house in the area... now where does the other end go?
Depending on how close they are he could run cables (ethernet) or fiber. Single mode fiber can go 10km according to some Ubiquiti spec sheets I found on google. Ubiquiti also sells AirMax products that can do PTP or PTMP over the air, although some will be affected by rain. They could even rent space from a radio/cell tower. There are probably a decent amount of other products out there I am only familiar with Ubiquiti.