Outlook: One2One

IF DEUTSCHE Telekom's Ron Sommer were to have a One2One (or an EinZweiEin as we perhaps ought to call them now) who would it be with? He could do worse that chose Mr Justice Moses, who yesterday put the icing on the cake of Deutsche's pounds 8.4bn purchase of Britain's smallest mobile operator.

The judge has ruled that when the Government dishes out the next round of third generation mobile licences, new entrants will not have a mandatory right to piggyback on the networks of existing operators at preferential rates.

This means that ministers will now have to rethink their plans for auctioning off the licences. Although, it will result in a delay in the process, it should save One2One and the other mobile operators money and reassure them that the Government cannot fiddle with their licences willy-nilly in future.

That said, having bought One2One on the rebound from Telecom Italia, the Germans have certainly set a test for the bottomless pit that is Deutsche's balance sheet. There is a reason One2One is the UK's fourth biggest operator out of four. Of all the networks, it has been the slowest to exploit the business market. And although it is slowly overcoming the legacy of all those subscribers who signed up for unlimited free calls in the early days, it now has the largest proportion of pre-pay customers, who could turn into tomorrow's albatross around the neck.

Deutsche is still paying telephone numbers to get a slice of the UK's mobile action. But the price is a 30 per cent discount to that commanded by Orange and a far cry from the pounds 11bn that One2One was optimistically put on the block for back in March.

How Mr Sommer plans to close the value gap with Orange and Vodafone Airtouch will be one of the more interesting questions to pose at Monday's press conference in the ballroom of the Dorchester. Get your One2One bath towels down early to avoid disappointment.