The Scottish government has struck a deal with BT to upgrade eight rural phone exchanges after broadband provision started to approach full capacity.
Scotland's enterprise minister Jim Mather said: "There is real frustration in some rural areas where households and businesses have been unable to obtain a satisfactory broadband service."
A BT spokesman said that BT would normally only upgrade exchanges if commercially viable, and that "Scotland has a disproportionate number of exchanges where they service relatively small numbers of people."
The spokesman added that the Scottish government and BT would each put money into the upgrade, but said that the financial terms would not be disclosed.
The exchanges are spread over seven areas: Moray, Lochaber, Argyll and Bute, Skye and Wester Ross, the Scottish Borders, Caithness and Sutherland, and Dumfries and Galloway.
Last September the Scottish government said it would work with BT to identify and agree an upgrade programme, and in December it said it had plans to upgrade 72 exchanges.
BT Scotland director Brendan Dick said that this latest announcement "would bring the number of exchanges to be upgraded to 80 by 2011".