Deutsche Telekom’s UK mobile operation T-Mobile said Thursday it has struck a deal with European MVNO Vectone Mobile to bring a no frills, ethnic targeted service to the UK.

Vectone Mobile already runs MVNO operations across Europe, with over one million users in total across Denmark, Norway, Austria, The Netherlands and Switzerland.

The low-cost prepay service will predominantly target an ethnic customer base, which T-Mobile estimates as a potential target of ten million subscribers in the UK generating more than seven billion calls per year.

The Vectone MVNO will sit alongside T-Mobile’s other hosted service – successful UK MVNO Virgin Mobile – giving the firm a more than 50 per cent share of the UK wholesale market.

T-Mobile UK managing director Richard Moat said: “The deal with Vectone signals our intent to become a major player in the ethnic MVNO arena.  With international calling card minutes rapidly migrating to mobile, this is an excellent time to be forging new partnerships in a segment which is showing signs of bucking the recession with strong projected growth rates.  Vectone builds on our eight existing MVNO partnerships and underlines our ambitions to target new growth areas in the wholesale market.”

Deutsche Telekom and France Telecom recently announced a merger of equals of their UK operations, with T-Mobile and Orange to be folded into a 50:50 joint venture. This move would create a new market leader, with over 33 million subscribers and a 43 per cent share of the UK market.