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Last Updated: Wednesday, 24 October 2007, 12:25 GMT 13:25 UK
Carphone enters Vodafone tie-up
Carphone Warehouse storefront
Carphone Warehouse and Vodafone are working together again
Carphone Warehouse is to launch a new mobile phone service, which will run through Vodafone's network.

To be called Talkmobile, it will run alongside Carphone's existing services, Fresh and TalkTalk Mobile, which operate through T-Mobile's network.

The deal with Vodafone comes as a surprise, as a year ago Vodafone said Carphone would no longer be able to sell its mobile phone contracts.

A sign of rapprochement between the two firms, Carphone's shares rose 3.6%.

Carphone Warehouse will continue not to sell Vodafone's mobile phone contracts.

Renting network space

Talkmobile will be a pay monthly service based around a nine-month contract.

It will operate by renting excess network capacity from Vodafone, the same as Fresh and TalkTalk Mobile do through T-Mobile.

Virgin Mobile has a similar arrangement with T-Mobile, and such services are known as mobile virtual network operators or MVNOs.

Carphone is the UK's largest mobile phone retailer.

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