Mobile phone operator One2One is risking cannibalising its own mobile business in order to partner with new operator Virgin Mobile, according to analysts.

One2One and Virgin Group are planning to launch Virgin Mobile as a joint venture. The new operator will pay One2One to make use of spare capacity in its network.

Rosalie Nelson, a new media analyst at Ovum, said other operators are concerned that a new mobile operator might cannibalise existing sales.

"For every 100 new users that Virgin gets, we estimate that 30 would have gone to One2One."

One2One MD Tim Staples said the joint venture would increase data transmissions across the network: "Our operation is ready to cope with increased traffic."

However, One2One said its network has huge additional capacity for voice and data, and about eight times more users during the day than rival operator Orange.

An Orange spokesman pointed out that One2One's network is hardly used during the day and that having so much spare capacity shows how inefficient the network is.