A major European cash boost has been granted to help the council develop a fibre-optic link with Faroe.
The SIC has been given £367,500 from the European Regional Development Fund (ERDF).
The funding will enable a connection to be made to the Faroese fibre optic cable, which runs between Faroe, Shetland and Orkney and the Scottish mainland.
Marvin Smith of the council’s telecoms project team said: “This funding will enable the council to progress the creation a fibre optic network for Shetland by putting in place the necessary infrastructure to link in to the Faroese cable.
“The project is vital to give Shetland a modern telecommunications structure and enable future broadband telecoms projects to materialise.”
Councillor Gussie Angus, the European spokesman, said: “I’m delighted that we’ve managed to secure external funding for such an important project.
“The council has taken an innovative step in deciding to take responsibility for coordinating and developing its telecommunications infrastructure and this is a project which will eventually bring benefits to the whole of Shetland.
“Improved telecommunications plays a significant role in today’s economy and as well as being vital for modern business brings many social benefits.”
Meanwhile, MSP Tavish Scott used secretary of state for Scotland Michael Moore’s visit on Monday to press the UK government to help to provide better, faster broadband connections across the islands.
Mr Scott said: “Shetland appreciates any new European funding to help the development of our broadband connections, so the news of the European Regional Development funding for the Shetland fibre optic network is welcome. But more is needed.
“As one of the most remote areas in the UK, we need a level playing field when it comes to broadband connections. Access to high speed broadband connections across Shetland is of vital importance to business and to our islands’ economy.
“I made the case in person today to the Liberal Democrat Secretary of State for Scotland for the UK government to provide further help to boost broadband access across Shetland.”