EE may stop selling in Carphone Warehouse and Phones 4u

EE is reportedly in discussions to pull its handsets from Carphone Warehouse and Phones 4u.

Carphone Warehouse prides itself on its ability to offer customers a comparison on networks all in one place. It currently offers EE, Vodafone and O2 so if EE were to pull out it would damage that offering and threaten its potential £3.6 billion merger with Dixons.

The move, reported by The Telegraph, comes after the deputy chief executive of Orange, a part of the EE joint venture, urged EE to "get rid" of third party retailers in favour of dealing directly to customers. With network operator profits damaged by competition and regulations the third party retailers are becoming less tolerable, it would seem.

A spokesman for EE said: "While we do not comment specifically on ongoing negotiations, we can confirm that we’re formally reviewing our distribution strategy, primarily in the consumer space, with a view to fewer, deeper partnerships, based on value and shared ambitions."

EE, formed of Orange UK and T-Mobile UK, is opening 50 new shops in towns where it is currently not represented. Vodafone is opening 150 new shops over the next 12 months. But with 780 Carphone Warehouse shops nationwide we may see a repeat of the Vodafone 2006 move where it left Carphone and returned after three years. Although if EE were to leave now that may ruin Carphone Warehouse's chances of merging with Dixons.

Carphone Warhouse's potential £3.6 billion merger with Dixons will be formerly voted on this July. Stock prices fell after the initial announcement.

READ: Carphone Warehouse and Dixons unveil £3.8 billion merger