Vodafone and Orange are close to signing a deal that will see the two operators “share the costs of technology, engineering and maintenance at their network base stations in the UK,” The Observer newspaper reported yesterday. The report said that the agreement is set to expand an existing deal between the operators to include 3G access network sharing and international network management. A collaboration around 3G would see the operators mimic UK rivals T-Mobile and 3, which last year created a joint-venture company called Mobile Broadband Network Limited designed to jointly manage their respective 3G networks in the UK.

According to The Observer, such a deal between Vodafone and Orange would be viewed positively by the financial community and could see UK-based Vodafone save £1 billion a year. A deal could also form part of Vodafone’s recently announced plan to cut operating costs by £1 billion a year by 2011. In November last year, the operator said it had identified “a significant number of cost programmes across the Group which we expect to reduce current operating costs by approximately £1 billion per annum by 2011,” although it did not specify details at the time.