TalkTalk to offer cheap mobile services, with a little help from Vodafone

Internet and phone provider TalkTalk has confirmed a deal with Vodafone which will allow it to offer mobile services under the TalkTalk brand, alongside its existing home phone and home broadband offering.

It's pretty big news for both companies. TalkTalk will be using Vodafone's network to enable it to offer both contract and pay-as-you-go mobile services to its 4.2 million existing customers; no doubt generating significant extra revenues for both itself and Vodafone in the process.

The mobile services, which will be available from this autumn, are rumoured to be 'low-cost', with TalkTalk's chairman Charles Dunstone commenting: "Our positioning and the pricing that we have makes us very, very appealing to people who are trying to cut back or are nervous about their expenditure," adding: "It will be a way to add a very good value mobile package to the account you have with us for your fixed-line phone and broadband."

TalkTalk, already one of the UK's biggest home broadband providers, announced financial results for the second quarter showing an addition of 34,000 broadband customers to bring it to 4.23 million. Alongside BT's 5.2 million and Virgin Media's 4.21 million, it represents a significant slice of the UK broadband market and has had considerable success with low-cost broadband services. It makes sense therefore for the company to expand its offering into mobile services, especially at the low-cost end of the market where it can potentially undercut competitors.