The government of New Zealand has announced in its annual budget that it will invest NZD290 million (USD180 million) in the national broadband network in 2009. The funding, which constitutes the initial stage of a NZD1.5 billion plan, will be distributed through the Crown Fibre Investment Company (CFIC) to fund local fibre companies (LFC) which will roll out fibre-to-the-premises (FTTP) networks in 25 towns and cities nationwide. The LFCs, which are prohibited from connecting directly with customers, will then sell dark fibre to operators in wholesale agreements. The budget has allocated NZD200 million to fund the initial rollout of network infrastructure and a further NZD6 million to pay for the CFIC. NZD48 million has been put aside to fund broadband provision in rural areas with the remaining NZD36 million covering operating costs and upgrades required to make schools broadband ready.