Vodafone's new deal with Carphone

Mobile phone giant Vodafone strikes new deal with Carphone Warehouse

Mobile phone giant Vodafone has buried the hatchet with Carphone Warehouse after agreeing to sell its contract mobiles across the chain's outlets.

Vodafone dumped Carphone as a supplier of contract mobiles in favour of an exclusive deal with Phones4U in October 2006, but has returned to the chain in an increasingly tough and competitive UK market.

Carphone Warehouse continued to sell Vodafone's pay-as-you-go phones and upgrades, but customers will now be able to sign up for a full range of contracts and broadband services at its 800-plus stores from Tuesday.

Carphone's chief executive Charles Dunstone said: "This agreement marks a continued strengthening of our relationship and will benefit both businesses and their customers."

Vodafone has also extended its agreement to sell pay-as-you-go and contract packages with Phones4U, giving it more than 1,600 stores to sell its deals in the UK.

The firm's consumer director Ian Shepherd said: "Carphone Warehouse has developed a formidable retail presence on the high street and we're very pleased to offer our customers even more choice."

Vodafone's recent annual results showed UK service revenues falling by 1.1% due to increased competition and challenging economic conditions. It posted profits of £11.8 billion in the year to March 31, but is unlikely to match the figure this year.

Carphone sold its retail business into a joint venture deal with US consumer electronics giant Best Buy last year. It plans to demerge its TalkTalk broadband business by next summer.