Carphone Warehouse is in talks with telecoms firm Three about launching own-brand mobile services for connected devices, it is understood.

As part of the potential deal, the retailer could offer mobile services to traditional devices including smartphones and tablets, alongside delivering connectivity to products such as cameras and white goods, according to The Financial Times.

The move comes as Carphone Warehouse approaches the completion of a merger with Dixons as the businesses seek to position themselves as an ‘internet of things’ retailer.

A tie-up with Three would involve a mobile virtual network operator (MVNO) arrangement whereby customers will have their mobile contract with Carphone Warehouse.

The business model would imitate Tesco’s partnership with O2 that involves the grocer offering mobile contracts through its Tesco Mobile brand.s

A Three spokesman declined to comment and Carphone Warehouse was unavailable for comment.