Optus is investing $1 billion to build an alternative mobile offering in regional Australia in a bid to break Telstra's "stranglehold" on coverage away from big cities.
The country's second largest telco on Friday announced plans to spend $1 billion on 500 new regional and remote mobile sites that it said will help connect rural businesses using its network to metropolitan and international markets.
Optus chief executive Allen Lew said the investment, to be made by the end of June 2018, will transform the company and challenge Telstra's national network position.
"To be a credible player in this market we must add a nationwide mobile network, to provide a viable alternative and enhance our value proposition," Mr Lew said.
"Today we've raised the bar as far as our competitors are concerned."
Mr Lew said in the past, the federal government made decisions that supported the creation of a single regional network.
"But now we want to break the stranglehold of the incumbent and we believe we can do it off our own backs," he said.
Mr Lew said consumer feedback from both increasingly mobile-dependent regional and metropolitan business customers indicated a lack of alternatives where needs were not being met.
"We looked closely at travel patterns and analysed data points to design a network that met the needs of not just regional customers but for the metropolitan businesses that service them."
Mr Lew said the strategic business opportunity will be to build market share in an increasingly competitive environment.
"We are looking to create a halo effect through regional investment in terms of getting higher output and winning further metropolitan business," Mr Lew said.
"Then of course the business case is made for carrying content through into regional areas," he said.
The Singtel-owned telco said its investment, including 114 new sites under the federal government's Mobile Blackspots Progam, will also upgrade almost 2,000 sites from 3G to 4G.
An Optus spokesperson said, as part of the government's co-funded blackspots program, which matches funding with provider investment, the federal government contributed just $26.4 million outside of Optus' entire regional investment program.
Mr Lew said the company was already is discussions with other providers over the availability of the new network hardware, including the towers.
"We will allow people to co-locate on our towers," he said.
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