Dubbo City Council believes a superfast broadband connection will encourage firms to relocate from Sydney to the regional NSW city.
The National Broadband Network's construction rollout in Dubbo will begin in June this year, with the final work set to finish by late 2015.
Dubbo mayor Mathew Dickerson said businesses in the city will be the main beneficiaries of an upgraded broadband network.
He said the NBN will provide greater upload speeds for local businesses, allow a greater use of online data back-up, and entice firms to move to the city, which is more than 400km west of Sydney.
Former NBN Tasmania board member, Mark Kelleher, also believes the NBN will have similar benefits in Tasmania, reducing its isolation from the rest of Australia and enticing mainland residents to relocate to the state.
"If you’ve got a business that provides services that effectively are delivered via telecommunications, which more and more are, then why wouldn’t you establish and run that business from Tasmania?" he previously told Computerworld Australia.
However, Guy Cranswick, advisor at IBRS, said it can be difficult to prove infrastructure such as the NBN will bring great gains to communities.
"The idea that one can turn an area which has been producing forestry and horticulture or pastureland and then turn it into some high-tech hub – I think that only exists in a marketing brochure on a whiteboard. I can’t see the evidence for it," he told Computerworld Australia.
"There are a whole lot of other ancillary factors that have to go into turning business centres around."
Cranswick argued that claims around the NBN's benefits need to be qualified and validly proven.
"[Someone] in Tasmania can say ‘it will transform it’, [but] it’s actually a meaningless statement," he said.
"I’ve seen some of the stuff that’s come out about turning, say, regional NSW into a hub or something. I think that’s going a little bit too far."
However, Dickerson said businesses will see a considerable benefit from the NBN.
A council survey of businesses found one firm began in Dubbo but moved its administration office to Sydney due to poor upload speeds, he said.
"Their first comment was, 'If the NBN was in Dubbo tomorrow, we don't want them in Sydney, we would much rather be in Dubbo but we need the upload speeds'," Dickerson told AAP.
The mayor said both workers and firms would gain in relocating from Sydney.
"What you will find is businesses in Dubbo will have a huge advantage over a business in Sydney -- quality of life, higher productivity, lower cost of living," Dickerson said.
However, a recent report by Roy Morgan found 40 per cent of small business owners believe the NBN will not help their business.