A start-up company wants to connect an underwater fiber optic cable from Woods Hole to Vineyard Haven that is intended to vastly improve Internet and mobile phone service to Island customers.

Pitched as a way to boost economic development through an increase in bandwidth, the plan by GPS Fiber Communications Inc. calls for placing approximately 26,600 yards of submarine fiber optic cable from Fairhaven to the Island via Woods Hole.

The cable would arrive at Lake Tashmoo in Vineyard Haven where it would be connected to existing utility wires. GPS Fiber has applied for a permit from the U.S. Army Corps of Engineers; a public comment period began on Feb. 2 and ends March 4. The plan will also need approval from the Tisbury conservation commission, and will quite possibly be referred to the Martha’s Vineyard Commission for review as a development of regional impact.

As of this week GPS has only filed an environmental notification form required by the Massachusetts Environmental Policy Act, and has yet to make a formal application with the town conservation commission.

The Army Corps issued a news release about the project. “Loss of this habitat may adversely affect various species and life stages. However, the Corps has made a preliminary determination that the site specific adverse effect will not be substantial. Further consultation with the National Marine Fisheries Service . . . is being conducted and will be concluded prior to the final permit decision,” the release states.

Chris Lynch, vice president for development at GPS, said this week his company was started after Andrew Nanaa, now the company’s vice president, moved to the Vineyard about four years ago and realized that Internet and broadband access on the Island was poor.

“It became painfully obvious to [Mr. Nanaa] there was a dearth of bandwidth on the Island. Since then the company has worked hard to address that problem. We see this project not only as a chance to catch the Vineyard up, but to put it ahead in terms of bandwidth and information technologies,” Mr. Lynch said, adding:

“The way we look at it is this cable could possibly take care of the Island’s communications needs forever.”

Fiber optic communication is a method of transmitting information from one place to another by sending pulses of light through an optical fiber. Optical fiber is generally chosen for systems requiring higher bandwidth or spanning longer distances than electrical cable can accommodate. The main benefits include high data-carrying capacity.

Currently, most telephone, television and Internet traffic on the Vineyard comes to the Island via some type of cable, but is transmitted to and from the mainland on microwave radio signals. The GPS plan is not associated with the OpenCape project, an attempt to create a broadband network across southeastern Massachusetts.

Mr. Lynch said the estimated cost of the project is about $7 million; the businessmen plan to arrange financing through investors and borrowing. The company would then lease the use of the cable to businesses such as Comcast and Verizon.

He said the company’s long-term plan is to start a resale operation that offers customers phone, cable and Internet service.

“Absolutely this could save Islanders money. That is a big part of this plan. But for the time being we are focusing on connecting the Island and offering straight wholesale bandwidth to current providers. Eventually we want to offer our own product, which could benefit not only homeowners, but also schools, hospitals, the towns,” he said.

Mr. Lynch said the increased broadband could have many benefits for businesses and research organizations. For example, he said the Woods Hole Oceanographic Institution, which operates a coastal observatory off South Beach, would greatly benefit from enhanced broadband service.

Fred LaPiana, director of public works in Vineyard Haven, is high on the plan.

“If this company were successful we could see all the communication placed underground. That would still leave the electrical wires, but it would make it all that much easier to place those [electrical wires] underground, because the towns would only be dealing with one company,” he said.

He also said it would give Comcast some competition.

“I’m not a Comcast subscriber. But I have heard over the years that people’s cable bills keep going up, while [television channels] are being taken away. At the very least this may put some pressure on [Comcast] by giving people options,” he said.

Mr. LaPiana said town voters at the 2008 annual meeting agreed to grant an easement to GPS to construct a communication switching station for a fiber optic network on the public works property on High Point Lane.

Dukes County manager Russell Smith said the company has already approached county commissioners about possibly creating a public-private collaborative which might involve some type of revenue sharing with the six Island towns.

Although the talks are still preliminary, Mr. Smith said there could be an upside to it all. “You could make the argument that the company would prefer to negotiate with a single Island-wide agency like the county, instead of six Island towns, which could result in some savings or revenue for the customers,” he said.

“There may be a potential to improve services while cutting costs — which is always a good deal,” he added.