The BBC's free-to-air, web-connected TV service will become available next year under the brand of YouView.
The service will combine Freeview digital channels with on-demand content such as the iPlayer.
Kip Meek, chairman, said, "YouView is key to ensuring that everyone in the UK benefits from next-generation TV and the UK has a competitive market. Viewers will get more choice while broadcasters and content providers both national and local will get a fantastic new means of finding audiences."
YouView set-top boxes will be available for a one-off fee, offered at special rates as part of new or improved broadband packages. Viewers will need a broadband connection from their chosen internet service provider to get the full range of on-demand and interactive services.
However, the project is not without its critics. Virgin Media has complained to Ofcom that the service is anticompetitive, restricts consumer choice and jeopardises the future development of next-generation TV in the UK.