NBN Co told its staff on Wednesday that numbers would fall from 6300 to 5500.
Chief executive Stephen Rue said in an email sent to staff: "With the initial network build complete and as we embark on our customer-led transformation in earnest, I would like to announce a series of changes to our operating model and executive management structure, as we align ourselves for the future.
He also said in another statement: "As we have approached the final stages of the initial build, we have talked about changing the size and shape of the organisation and we are now preparing for the next phase of the company's evolution."
Of the total number of 12 million premises, only 7.3 million have decided to take out connections. As other, better options are becoming available with some providers rolling out their own fibre and others beginning to offer plans based on 5G, those numbers may not grow at the rate predicted, according to some commentators.
Communications Minister Paul Fletcher has not commented publicly on the sackings.