Vodafone 'toys with Tiscali buy'

Speculation is growing that Vodafone is preparing to buy one of the UK's fixed-line telecommunications operators.

The Sunday Telegraph reported that Vodafone has identified Tiscali as a possible takeover target, as part of a push to expand its product offering. Bulldog, Cable & Wireless's broadband ISP, is said to be another option, despite its track-record of poor customer service. Vodafone described the reports as "speculation".

Vodafone currently just offers mobile services - unlike rivals such as Orange, which is aggressively pushing a strategy where it offers both fixed-line and mobile services. With convergence such a hot issue in today's telecoms market, Vodafone is under growing pressure to become more than just a mobile player.

Last month, some analysts argued that the company should even consider bidding for BT.

The mobile operator has been conducting a major strategic review of its future over recent months, and is expected to reveal its conclusion next month. An acquisition of a fixed-line operator would help Vodafone to widen its product range.

However, it could also decide to simply buy and resell wholesale fixed-line services, or even move into the fixed broadband market itself through local-loop unbundling.

Graeme Wearden writes for ZDNet UK