Hamburg (dpa) - Arcor, a subsidiary of phones multinational Vodafone, is to offer German customers from March a telephone service that uses the internet only, without traditional phone circuitry, the company said Wednesday in Hamburg.

Spokesman Michael Peter said Arcor would be the first major phone company in Germany to offer home customers the all-internet-protocol (IP) service. Arcor demonstrated a white box the size of a large paperback book which will connect existing phones to the network.

Arcor is Germany's number-two fixed-line phone provider after former monopolist Deutsche Telekom and is 74.9-percent owned by London-based Vodafone. Deutsche Bahn and Deutsche Bank own the rest.

Peter said Arcor was currently signing up about 200,000 new customers per quarter in Germany, Europe's biggest market.

Unnoticed by most consumers, many phone companies around the world have completely converted their backbone networks to IP, whereas home and small office customers have been hooked up through old-fashioned analogue phone lines or an ageing technology known as ISDN.

Arcor executive Zoltan Bickel demonstrated the white box, manufactured in Asia to Arcor specifications, which automates the complex task of reconnecting existing phones to the new technology.

He said new customers would be offered the "next generation network" from the time of the Cebit computing trade fair to be held in Hanover, Germany from March 15 to 21 and promised there would be no deterioration in voice quality.

Combined phone and Internet access charges would remain the same as at present. There would be no compulsion: users could retain traditional lines if they preferred. Arcor also announced Wednesday a new television service using its broadband connections.

DPA

Subject: German news