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TalkTalk is buying Tesco's heavily promoted Blinkbox streaming service. The telecoms group will also pick up Tesco's budget fixed line broadband and phone businesses.

Tesco is selling the businesses after announcing falling sales and profit warnings. The supermarket will also close 43 shops across the UK, make cuts of £250 million and reduce overheads by 30 per cent.

TalkTalk TV has over 1.2 million customers, and proclaims itself the fastest growing TV platform in the UK.

"Since launch TalkTalk TV has demonstrated its popularity with value-seeking customers to become the UK's fastest growing TV service," Dido Harding, chief executive of TalkTalk, said in a statement. "We are excited about the opportunity that Blinkbox's platform and technology expertise bring, and which will significantly accelerate the development of our TV platform.

"The purchase of Tesco's broadband base is another example of TalkTalk leveraging its national network to grow faster. We are excited about the future of quad-play – fixed phone and broadband, TV and mobile – and this acquisition will help to further drive home our value for money advantage."

Before Christmas, TalkTalk offered a series of money-saving deals to cash-strapped viewers, including Sky Sports and Sky Movies half price, and six UKTV channels for free.

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