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TalkTalk hangs up on Vodafone and switches to O2

Last updated: 18:58 17 Nov 2014 AEDT, First published: 19:58 17 Nov 2014 AEDT

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TalkTalk (LON:TALK) has decided to hang up on Vodafone (LON:VOD) and sign a “multi-year” wireless deal with O2.

The switch gives TalkTalk’s UK mobile customers access to 4G wireless internet, along with the 2G and 3G services that were already in place.

“We’re hoping for a smooth medium-term transition off of the Vodafone network,” a TalkTalk spokesperson told Proactive Investors.

“Coupled with our own slither of 4G network, the deal creates a powerful opportunity for us to build our in-house 4G offering, and continue providing low cost connectivity to our customers.”

The move comes as the UK telecoms provider continues to shift to a “quad-play” strategy - bundling mobile, broadband, TV and home phone deals as standard.

Last week TalkTalk said its mobile base now had 350,000 customers or 9.5% of its total base.

The firm also posted a pre-tax profit of £20mln in the half year to September, and said it expects to grab a greater market share off rivals in the UK’s quad-play market.

"This is a significant development for TalkTalk, building on our success in mobile to date,” said TalkTalk chief executive Dido Harding.

"We are ideally placed to benefit from the market shift to quad-play, with a sizeable and growing number of customers already choosing to take mobile from us. We see real opportunities in both the near term and further out, to work with Telefónica UK to further accelerate our quad-play growth."

Ronan Dunne, Telefónica UK chief executive, added. "This recognition, as a leading source of essential connectivity, comes as a result of our continued and significant investment in our nationwide network. We welcome the start of what we hope will be a successful and prosperous relationship for both parties."

TalkTalk shares were 2p higher at 292p.

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