UK phone firms discuss French launch

Virgin Mobile and Carphone Warehouse today confirmed they were in talks over the launch of a mobile phone service in France.

The joint venture would see Virgin phones sold in Carphone’s Phone House outlets in France as well as in Virgin Megastores.

The service will operate under the Virgin Mobile brand and use the Orange network.

It is likely that the two UK companies will invest a total of about £50m (€74m) over three years.

The deal will inject competition into the French market which is currently dominated by just three players – Orange, Bouygues Telecom and the Vivendi and Vodafone-owned SFR network.

As a mobile virtual network operator (MVNO), Virgin does not have its own network but buys airtime from established operators.

It is majority-owned by entrepreneur Richard Branson and is the UK’s largest MVNO with more than five million customers using the T-Mobile network.

A tie-up with Carphone – Europe’s biggest mobile retailers – would give Virgin a ready-made distribution network for its phones.

Both companies are well known in France thanks to Virgin’s music megastores and around 200 Phone House stores.

In a joint statement to the stockmarket today, the companies said: “Virgin Mobile and Carphone Warehouse today announce that they are in discussions regarding the launch of a nationwide mobile virtual operator in France.

“Subject to agreement being reached, the MVNO will operate under the Virgin Mobile brand and use the Orange network.”

It is understood that the new service will launch in the first half of 2006.

Virgin Mobile is part of Virgin Group and employs around 1,400 staff in the UK in Trowbridge, London and Daventry. It also has an outsourced customer service centre in Middlesbrough.

Carphone was set up in 1989 by Charles Dunstone and has an annual turnover of £2.3bn (€3.4bn). As well as selling phones, it provides telecoms services to over one million people in the UK under its TalkTalk brand.