Orange targets immigrants with international phone deal

Orange has launched a cheap international phone service that will allow millions of foreign workers and immigrants in the UK to call abroad from a mobile phone at better rates than offered by international calling cards.

People in the UK spend about £800m on international calling cards a year to take advantage of cheap advertised rates when calling friends and family overseas. However, users often find call costs are much higher than advertised because of high connection charges and unclear pricing structures, and the telecoms regulator Ofcom has cracked down on a number of unscrupulous card suppliers.

Orange is the first mobile phone operator to target the international calling-card market and to offer services specifically aimed at the millions of foreign workers and immigrants residing in the UK. The mobile phone company will sell an "Orange Call Abroad" SIM card that matches some of the cheapest rates available using calling cards but without any hidden costs or connection charges. Users who buy the SIM card will be charged 6p a minute to call Australia, New Zealand, China and the US, 12p a minute to call India and 21p a minute to call Poland. Calls will be charged at a flat rate to 34 countries and Orange will review its tariff structure after the service is rolled out.

Calls made to UK users will be charged at normal pay-as-you-go tariffs. The pay-as-you-go SIM card will cost £5 and will be sold over the internet, in Orange stores and in corner shops.

Simon Gwan, a product marketing manager at Orange, said 30 per cent of people who buy international calling cards in the UK use a mobile phone to make the call. He said Orange Call Abroad users would benefit from the same cheap tariff, without the need to enter long pin numbers and pay the 25p a minute national call charge. He added that the call quality is often very poor using international calling cards and voice over internet protocol, or VoIP, services such as Skype whereas using a mobile phone offers better call quality.

Orange has high hopes for the new service, given the size of the international calling-card market. The mobile operator is able to use parent company France Telecom's international network to carry calls at a cheap rate as the company looks to leverage its fixed and mobile assets. The service is an example of network convergence between fixed and mobile telecoms assets.

Mr Gwan said the service would initially be offered in London, where a large proportion of the foreign workforce is based, before Orange rolls out the SIM card to other urban areas with large multi-ethnic populations. He said the advertising campaign would be targeted geographically, with Tube and bus-stop marketing in areas with large immigrant populations and in local press aimed at ethnic minorities.