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BT teams up with Vodafone in mobile push
Tue 18 May, 2004 11:34



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LONDON (Reuters) - BT Group says it is teaming up with former arch-rival Vodafone, the mobile phone market leader, to boost its fledgling cellphone business.

BT BT.L , which long battled Vodafone VOD.L in its domestic market before spinning off its mobile arm in November 2001, said on Tuesday it hoped the alliance would help it generate around 1.0 billion pounds in annual revenues in five years.

"It is a first relationship of its kind, going way beyond any normal service provision deal, as we will work closely on a number of fronts, with Vodafone UK providing the network services for BT's internal and external requirements," BT's retail arm chief Pierre Danon said in a statement.

BT, which is searching for fresh growth opportunities to offset falling revenues in its core fixed-line business, announced plans to return to the mobile market last June. It now has 170,000 residential and business mobile customers.

As part of a move to ensure that it will not lose customers to its rivals, BT said it planned to launch a combined fixed and mobile phone, dubbed "Project Bluephone", before the end of the year.

The new phone will allow customers to make both fixed and mobile calls whenever they are in reach of a BT wireless access point in their homes or offices, using one phone.

"If they move out of coverage range, they will seamlessly link to our partner's cellular GSM or 3G (third generation) network for voice and data, giving them the best available connection wherever they are," BT said.

BT shares climbed 0.6 percent to 170.25p, while Vodafone stock stood almost one percent stronger at 135p.

http://www.reuters.co.uk/newsPackageArticle.jhtml?type=businessNews&storyID=512925§ion=f...