British-based telecoms group Orange, which failed in its bid to win the third mobile phone licence, is to challenge the decision in the High Court. The action is expected to further delay the actual issuing of the licence to Meteor, the successful consortium.

Orange confirmed yesterday that it had served appeal proceedings on the Director of Telecommunications, Ms Etain Doyle. A spokesman said the company firmly believes that the director's decision not to award the licence to Orange will disadvantage Irish consumers.

"Since Orange's initial application for the licence, Orange has maintained that it would provide a state of the art mobile phone service to Irish customers which will offer better value for money, service and coverage than Meteor."

Orange has already applied to the High Court for a judicial review last July, which it said was to protect its position. Under a series of somewhat complex manoeuvres, during which Orange claimed it had not been given detailed reasons as to why its application was not ranked first, the company decided to pursue the matter through a High Court appeal.

The regulator wrote to Orange earlier this month, pointing out that this course of action was open to it. A spokesman for the regulator said last night that Ms Doyle was awaiting delivery of a Statement of Claim from Orange.

A spokeswoman for Meteor said that the matter was for Orange and the Regulator. "We have every confidence in the regulator's decision," she said.

It is understood that the moves by Orange have delayed by several months already plans by Meteor to roll out its network. Although Meteor is expected to target niche mobile sectors and provide some innovative products, the huge success of current operators Eircell and Esat Digifone, means getting to the market as soon as possible is a priority, according to industry sources.

The Orange spokesman denied last night that the company was taking its action, because it felt sore at losing the competition.