A multi-million pound investment in world-leading broadband facilities could create up to 4,000 jobs in Cornwall and the Isles of Scilly.

The scale of the project means that if Cornwall were a country, by 2014 it could be one of the top five broadband nations on the planet.

Telecoms giant BT has been selected as the private sector partner who will install the infrastructure for the £132-million scheme to deliver superfast broadband to the Duchy.

According to BT, the project shows that with the right programme of investment, even Britain's most rural and challenging areas can lead the way when it comes to internet connectivity.

In a separate announcement, BT said it was also upgrading exchanges in Devon and Somerset including Plymouth, Ivybridge and Taunton to allow about 96,000 additional homes and businesses access to faster broadband.

BT is investing £78.5 million in the Cornwall and Isles of Scilly scheme with the European Regional Development Fund providing the remaining £53.5 million — the largest single investment of the Convergence programme.

Cornwall Council believes that the massive upgrade — which will see between 80 and 90 per cent of homes and businesses able to access broadband speeds of 100Mbps — will see 4,000 jobs created in the Duchy as native businesses expand and companies relocate from other parts of the country to take advantage of both the technology and the quality of life.

Broadband speeds of 100Mbps – or megabits per second – will pave the way for the next-generation internet service, which is 24 times faster than the average UK broadband connection speed of 5.2 megabits per second.

"This is a once in a lifetime investment that will continue to benefit our economy for decades to come," said councillor Alec Robertson, leader of Cornwall Council.

A total of 130,000km of fibre will be laid in the Duchy to bring the fastest speeds, with other technologies such as advanced copper, satellite and wireless broadband also used, particularly for the most remote areas.

BT chief executive Ian Livingston pledged that all parts of the Duchy would see an upgrade to current connectivity levels. He said: "I believe this is the most ambitious rural fibre project, probably anywhere in Europe, if not the world."

Initial infrastructure work is now under way with five locations already chosen to be in the first wave of connections.

Nigel Ashcroft, from Cornwall Council, director of the next generation access programme for Cornwall and the Isles of Scilly, said that details of these initial connections would be given early next year. But he said that they were a mixture of urban, rural and "very rural" areas.

"We don't want to just focus on the big towns — we are committed to covering the whole area," he said.

Mr Ashcroft said the team would also prioritise the Duchy's "not spots" — where no broadband service was currently available — to receive better connections.

The roll out across Cornwall will take place between spring 2011 and 2014 with an emphasis on a fast connection rate so businesses in the Duchy can gain the maximum competitive advantage from the investment. There will also be a business support programme to help companies make the most of the new technology.

Professor Anne Carlisle, rector of University College Falmouth, said the upgrade would put Cornwall at the vanguard of new technology.

"This gives an opportunity to bring the (broadband) pipes into high-end research areas to work with existing businesses in the region to develop the businesses of the future, many of which we have not even imagined," she said.

As a result of the upgrade, businesses will be able to significantly increase their productivity — uploading large amounts of data, using high-quality video conferencing and using technology like cloud computing where services are hosted over the Internet.

Paul Davies, chairman of the Cornwall Design Forum, said businesses should be ambitious to maximise the benefits of the technology.

"We have got to up our game. A lot of businesses have only just caught up with the web revolution but we need to take a step beyond that now and there needs to be an education of businesses because there needs to be a behaviour change," he said.