The free-to-air channel will fill the void left by Sky One. Virgin Media is understood to have lost tens of thousands of subscribers since Sky pulled its channels from the platform in March.
Virgin Media will focus on acquiring and promoting its own quality content for the channel, which will be available on the Freeview, Virgin Media and Sky platforms.
The company is seeking an advertising agency to spearhead an extensive ad campaign for Virgin 1, which will launch this autumn.
Industry insiders said that Virgin Media has set aside a substantial budget to market the channel and acquire fresh programming. It is also in talks with Setanta Sports about launching its own branded sports news channel to rival Sky Sports News.
Virgin 1 will also be used to promote the premium Virgin Media portfolio by giving Freeview viewers a taster of its pay-TV shows.
Jonathan Webb, managing director of Virgin Media Television, aims to make Virgin 1 one of the 10 most-watched channels by digital switch-over's completion in 2012.
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