In a shift away from the normal fixed copper wire telephone network, Telstra and Nortel Networks plan to pilot Wireless Local Loop (WLL) technology in remote Australia later this year.
The pilot will be undertaken at King Island in Bass Strait where Telstra completed stage one of the area's mobile network on Friday.
The new CDMA mobile network and the WLL pilot which supports phone, fax, data and the Internet is being made available to 350 island residents.
Telstra's southern region managing director, Lawrence Paratz said the potential benefits of delivering wireless services are "enormous" as there would be no waiting for new infrastructure.
"With CDMA and WLL there is no need to install and maintain an expensive cable network; no lead ins are required into customer's homes and no cable breaks caused by the harsh Australian environment," Paratz said.
The six-month pilot will start in December.