Brisbane has turned its back on the federal Labor government's national broadband network (NBN), announcing it would go it alone and build its own network within four years.
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The fibre optic network will be installed in the city's wastewater network and sewer pipes from next year.
It's expected that about 15,000 homes per month would receive access to the network once the rollout begins.
Lord Mayor Campbell Newman, from the Liberal National Party, said he "was not prepared to wait" for the federal Labor government's network to be built in Brisbane.
In a surprising move, federal Communications Minister Stephen Conroy welcomed the project. He said that the decision to go with fibre vindicated the government's choice to go with fibre for the NBN.
"The government looks forward to seeing more details on the Mayor’s proposal," Senator Conroy said in a statement.
He said it was "disappointing" the Mayor’s federal Liberal colleagues were "unable to grasp the importance of the transformation this technology would deliver to Australians".
Opposition's communications spokesman Malcolm Turnbull's office declined to comment.
However, Turnbull this week indicated that he thought capital cities already had fast enough broadband.
"The majority of Australians already have access to fast broadband," he told a broadband conference in Melbourne on Wednesday.
He said 85 per cent cent of Australian's already had access to ADSL2 services, while another 30 per cent could access Telstra or Optus' cable.
NBN Co, the company charged with building Labor's NBN, said it was business as usual for it and that it would continue its national rollout.
The deal with Brisbane-based multinational i3 Asia Pacific would provide homes and businesses access to 100 megabits-per-second broadband, the same speeds the federal Labor government plans to offer on its broadband network.
i3 would act as a wholesaler, providing broadband capability to existing telecommunication retailers, such as Telstra and Optus. It would pay for the network and offer the infrastructure to internet service providers.
Brisbane's Mayor said i3 Asia Pacific was rolling out a similar scheme for the whole of Scotland and had successfully operated similar schemes in the United Kingdom since 2002.
"The NBN program has no firm timetable for a rollout across Brisbane,” he said.
"[It] has not put the needs of Brisbane on as high a priority as we would like and we didn't want local residents and businesses to be left behind in the 20th century.”
The project followed a successful trial and would come at no cost to ratepayers, the Mayor said.
“This is a voluntary scheme, there will be no opt-out deals or compulsion to force people onto this scheme,” he said.
