Startups could have their products or services marketed alongside BT's as the telecoms giant rolls out superfast broadband across the country.
It has partnered with TechHub to launch Infinity Lab, a programme offering six months' support, including R&D, engineering and legal expertise, to entrepreneurs whose winning ideas would be promoted alongside BT's own.
The winning startups would also get office space in TechHub's sold-out community space in Shoreditch, accessing business support, workspace and an international community of tech entrepreneurs.
The programme is seeking startups with innovative ideas for products or services utilising superfast broadband, which 73% of Britain can now access, according to Ofcom.
A project to rollout superfast broadband to 90% of Britain including rural areas by 2017 is costing the government an estimated £1.2bn, and it has been criticised over its tendering process, which has resulted in BT gaining a virtual monopoly over the contracts to roll it out.
But communications minister Ed Vaizey said: "TechHub and BT are to be congratulated on this brilliant initiative which will result in exciting new products and prototypes, helping all UK internet users to make the most of all the benefits superfast speed has to offer."
BT said it is not looking to invest in successful companies itself, or buy intellectual property rights, but would market the product to the millions of homes using its superfast broadband service.
Its MD for external innovation, Jean-Marc Frangos, said: "At BT, we embrace an open innovation approach, working with industry and academic partners to diversify our product and service offering and develop new customer experiences. With this partnership, we are pleased to further extend our global innovation network and actively engage with the tech startup community."
And TechHub's founder, Elizabeth Varley, added: "Partnering with BT gives TechHub an unmissable opportunity to offer to tech start-ups. Working with BT gives entrepreneurs the chance to test their innovations with a major partner, receive specialised help and advice, and take advantage of the huge promotional reach offered by this bastion of British business."
Competition details can be found here and information regarding entry deadlines and how to enter are expected soon.