French mobile customers should see cheaper prices with the launch of the country's first virtual operators.

Mobile virtual network operators (MVNOs) do not own a network but piggyback on another company's network. Virgin Mobile, Tesco and BT are examples in the UK.

The first MVNO in France is Debitel - a German company controlled by British equity group Permira. Debitel will use SFR's network and will compete with existing operators on price. The company said it would use specific tariffs to target those without a phone and ethnic groups.

The French government is encouraging France Telecom's Orange, Bouygues Telecom and SFR to open their networks to virtual operators.

Patrick Devedjian, France's finance minister, wants to see two more companies operating by year end. Carphone Warehouse is rumoured to be in talks to with Orange about entering the French market.

Debitel will offer text messages for nine cents versus 15 cents per message charged by existing operators. It hopes to get five per cent of the market this year. French consumer groups are campaigning for cheaper SMS messages.

Debitel has about 10m subscribers in Denmark, Germany, Slovenia and the Netherlands. ®

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