Telstra will be improving its inter-city fibre network by building new fibre optic networks between cities, delivering Internet speeds up to six times faster.
Aside from adding up to 20,000km of cable, the carrier will also be setting up a complimentary fibre network for global communications provider Viasat.
These two networking projects, which are expected to be worth around $1.6 billion, will help solve the demand for more fibre capacity.
The improved fibre network will help users work remotely, watching movies and gaming and other online activities.
Telstra boss Andy Penn said the project would not only provide Internet speeds that are six times the common download rate of 100Gbps but will also improve connectivity for regional areas.
However, parts of the current inter-city network will be retired for the project. It is expected that work will start this financial year and will take about five years to complete.
Meanwhile, Telstra will also build and manage a fibre network for Viasat as part of a 16-year contract.
Viasat, which provides Internet services to consumers and businesses in Australia, will use three new satellites for the regions of its network.
Telstra will have satellite access node equipment at hundreds of sites and build fibre links to each.
Telstra enterprise executive David Burns said the project would be quite an engineering feat given the hundreds of points that needed to be connected.
The ground station set-up in Australia will help the satellite broadcast across the Asian region.
Staff at Viasat and Telstra have been discussing the project for the past 12 months.
Chief financial officer Vicki Brady said the projects would contribute earnings of $200 million by 2026.
The value of the Viasat contract was not disclosed.
Telstra shares on the ASX were higher by one per cent to $3.99 at 1521 AEDT.
With AAP