The Koryolink network is operated by Cheo Technology and was launched at 5 p.m. local time (8 a.m. GMT), said Rascha Mohamed, a spokeswoman for Orascom Telecom in Cairo. Cheo is a joint-venture company in which Orascom holds a 75 percent share and the state-run Korea Posts and Telecommunications Corp. (KPTC) holds the remainder.

Initially the network covers the capital city of Pyongyang but there are plans for service to be extended nationwide, Orascom said in a statement.

Cheo has been given a 25-year license to operate a WCDMA (Wideband Code Division Multiple Access) network in North Korea. For the first four years of the license, the operator has exclusive rights to operate a cell phone service and doesn't have to pay taxes for the first five years. Orascom says it intends to invest US$400 million in the network and the license fee during its first three years.

"This is not just about providing 3G mobile services; we are making history in a country that is developing and opening up in a remarkable way," said Naguib Sawiris [cq], Orascom chairman and CEO, in a statement. Sawiris was reportedly in Pyongyang to launch the network.

Orascom announced its deal in January and at the time said it planned to offer "voice, data and value-added services at accessible prices to the Korean people."