CWC's 'TV Mall' will be offered next year as part of its 200 channel digital service.

It will offer subscribers home shopping, banking and news and information services.

Deals have already been signed with a number of companies, including British Airways, Littlewoods, Barclays and Associated News Media, a subsidiary of the Daily Mail.

BSkyB is also planning home shopping services

The move throws down the gauntlet to British Interactive Broadcasting (BIB), the company jointly owned by satellite broadcaster BSkyB, British Telecom, Midland Bank, and Japanese electronics group Matsushita.

BIB is to provide home shopping services for BSkyB's 140 channel digital television service. The company says it is in talks with some 30 retailers but has yet to name them and BIB has already lost two chief executives this year.

Going it alone

Cable and Wireless said it considered using BIB, but in the absence of any concrete business plans decided to go it alone.

The CWC system will be Internet based, which is an advantage to retailers as they do not have to adapt their technology to run on BIB's applications.

CWC's chief executive Graham Wallace said: "There is clear evidence of the consumer appetite for greater flexibility in the purchasing of services and products, and for accessing information. Interactive retailing..is a natural extension of this powerful trend."

The company said it believed that adding these services would encourage the take-up of digital TV among its 800,000 subscribers.