Industry observers have expected Ten to make the move for some time, given the extent to which Nine's digital channel Go! has eaten into the youth television market.

The Sydney Morning Herald first speculated Ten's plans for a youth-channel as early as last year.

Ten will call the channel Eleven, and has formed a joint venture with the US studio CBS Studios International to deliver content to the channel.

Programs to feature on the channel will include Futurama, The Cleveland Show, Supernatural, Stargate, Dexter, Smallville, The Office, Nurse Jackie and the remake of 90210.

Ten will also shift The Simpsons to the channel.

The channel will launch early next year on digital channel 11.

The announcement follows Seven's announcement to launch a third digital channel, 7mate, which will target male viewers.

Nine is now the only network not to confirm its third network plans, though industry rumours have included a movie channel and a lifestyle channel.

Sources say the most likely move for Nine is a crime-themed channel, NineCrime, which would showcase Nine's library of crime-themed programming.

Digital terrestrial television has significantly expanded its footprint in the last two years, largely because of the expansion of services by the ABC (ABC2, ABC3 and ABC News 24) and the commercial networks (Go, 7Two and One).

It is now available in approximately 75 per cent of Australian households.