China Telecom, the nation's largest fixed-line operator, announced the launch of its mobile phone business in the United Kingdom on Tuesday night.

The service, called CTExcelbiz, will use leased capacity on the network of Everything Everywhere, the joint venture of France Telecom SA and Deutsche Telekom AG.

This partnership means that China Telecom will be the first Chinese mobile virtual network operator to be launched outside the country.

"This is the first time that we're selling a product directly on the consumer market, because our past customers were all companies. But we are fully prepared for this challenge," Ou Yan, managing director of China Telecom Europe, told China Daily.

Ou added that the launch was also linked to the London Olympic Games, when 170,000 Chinese tourists are expected to visit Britain.

With around-the-clock Chinese and English language customer services, designed to provide information on transport routes and tourism services, the new product hopes to attract Chinese residents and visitors to the UK.

Under a mobile virtual network operator arrangement, the mobile phone operator provides services directly to its own customers but does not own the network or the infrastructure behind the services.

Ou hailed the launch of CTExcelbiz as a milestone for his team.

CTExcelbiz will be sold as a SIM card, currently available only through the company's website. The company plans to add more points of sale later.

International calls to Chinese landlines and mobiles cost 2 pence (3.2 cents) and 4 pence per minute respectively, while calls to UK mobiles cost 10 pence.

Different bundles that mix and match talking minutes, text messages and data usage are also available.

Competition will be tough since service providers in the UK that focus on the international call market, including Lebara and LycaMobile, already provide very cheap call rates for as little as 1 pence per minute.

But Ou argues that providing a tailored service rather than starting a price war will help CTExcelbiz stay ahead of the competition.

"If I try to beat their prices by introducing (rates of) 0.5 pence per minute, then both of us will lose revenue. Instead, we want to use China Telecom's popularity in China to sell CTExcelbiz to the Chinese community."

As of 2010, about 271,000 Chinese were living in Britain, according to the British Office for National Statistics, or about 0.4 percent of the population.

The UK attracted 110,000 Chinese tourists in 2010, up 23 percent from the year before, according to the Daily Mail.

Lord Stephen Green, British minister for trade and investment, called the launch of CTExcelbiz a "milestone event".

"China Telecom has shown the way for other Chinese companies into the UK," he said at the company's launch ceremony.

Liu Xiaoming, Chinese ambassador to the UK, tried the CTExcelbiz service and praised its "strong signal, quick connection and low price".

Liu added: "I believe the cost and quality of CTExcelbiz will make it immensely popular with its customers."

China Telecom announced plans to launch CTExcelbiz in January this year. If CTExcelbiz proves successful, the company will launch similar services in other European countries, such as France and Germany.

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