Cable & Wireless Optus is to lease a fibre optic cable between Brisbane and Cairns from Reef Networks, in a deal worth $100 million.
Yet to be built, the link will provide an alternative to Telstra's fibre optic link between the two Queensland cities.
Chris Anderson, chief executive, C&W Optus, announced the deal in a speech to the Australian Institute of Company Directors in Brisbane.
The length of the lease was not disclosed.
The new cable will extend C&W Optus ' fibre optic network which currently extends from Perth to Brisbane, via Adelaide, Melbourne, Canberra and Sydney.