Aimed at residential customers, the product is currently being market tested ahead of an autumn launch.
BT Retail consumer PR head Damien Peachey said the product would give BT residential customers 'direct, always-on access' and the ability to pay via the regular phone bill for the first time.
Current broadband services operated through BT Openworld, its internet division, involve payment through direct debit and credit cards.
Cake's account team will be overseen by CEO Mike Mathieson. The agency has been hired for a year-long project following a pitch process handled by AAR. The account is being handled by account directors Natasha Williams and Thea Gray, who report to Peachey.
Cake's new media, 'live' and design divisions will also be involved in promotional work.
Promotional activity for the product is seen by BT as crucial in achieving its target of a million broadband customers by next summer.
Cake has been briefed to gain coverage in the lifestyle media. But Peachey stressed that as the product is still being market tested, further details of the PR strategy are still being developed.
He said: 'We need to know how and which consumers want to use this product so we can get the best from our marketing.'
The product is expected to be rolled out into the satellite and digital TV market.
Meanwhile, BT Retail is continuing its hunt for just one agency to handle the bulk of its PR work. The account was described by sources close to the pitch process as 'the largest consumer account in the UK' (PRWeek, 21 June).
Agencies understood to be vying for the brief are BT roster shops Fishburn Hedges, Le Fevre Communications, Band & Brown Communications and Lewis PR.