Following a spell as chief executive of PR company Brunswick, Carter joined Number 10 as Brown's chief strategy advisor.
Andy Burnham, secretary of state for culture, media and sport, who, as a junior minister, Carter will report to, kept his post in the cabinet reshuffle.
Carter, who has been handed a peerage to take up his role in the House, said: "Given the global financial challenges, the communications sector has never been more important to our economy.
"This role is an opportunity to make a contribution to the growth of this key sector, and I look forward to working closely with Peter Mandelson [who was brought back in to the cabinet as secretary of state for business] and Andy Burnham."
Burnham said: "Bringing in such a significant figure at this time shows just how seriously the Government takes the future of broadcasting and the communications sector in the UK."
He added: "As I said last week at the Royal Television Society, there is now a real urgency to take the key decisions that will secure high quality public service broadcasting the future. I will be working closely with Stephen on this and I will be setting out the way forward in the New Year."
Tristan O'Carroll, Media Week, 06 October 2008, 10:55am
Former Ofcom chief named communications minister
LONDON - Former Ofcom chief executive Stephen Carter has been named as minister for communications, technology and broadcasting in the House of Lords, as part of Prime Minister Gordon Brown's reshuffle.
Carter: elevated to the House of Lords as communications minister
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