The phones will be made by a small French manufacturer, ModeLabs Group SA. Mr. Toledano says he expects to sell at least 10,000 of them a year at the beginning and hopes to reach annual sales of €200 million in the longer term.

Dior's new phone -- which will work world-wide, except in Japan and Korea, where it isn't compatible with local wireless networks. In addition to all the regular features of a cellphone -- a touchscreen, a camera, ringtones -- the Dior phone offers a new gimmick: a miniature phone barely bigger than a USB key. Dior says the mini "My Dior," as it is called, is handy for women who don't want to rummage through their bags to find their phones. Instead, the mini version of the phone clips to the outside of a bag for easier access. It communicates with the main phone, so people can pick up or make calls with My Dior and use the main phone for more complicated functions.