Viability of 3G mobile technology under threat

Upgrades to existing second generation (2G) mobile phone networks could make the billions spent so far on third generation (3G) UMTS licences redundant.

Specialists insist there are alternatives to the much-hyped UMTS technology - alternatives which will support the most applications such as web browsing and email, and provide greater voice capacity. Derek Nicholas, from the Telecommunications Managers' Association (TMA), said: "There is the cost of 3G to consider. It will not take off if the cost of the licences falls to the consumer. It is concerning that enhancing 2G, as an alternative to third generation, could actually undermine the viability of 3G." Arto Karila, professor of computing at Helsinki University, agreed. He said: "The 2G network can support any additional usage such as voice and data transfers. Enhanced technologies, such as GPRS, will allow access as fast as 50 to100Kb per second, which is enough for most internet enabled applications." However, Claire McCarthy, industry analyst from consultancy Ovum, claimed that the alternatives to 3G do not provide sufficient bandwidth for the applications being mooted. She said: "The alternatives were explored before the auctions started. It was widely accepted that it would be good to have additional spectrum which you will eventually need to use for higher bandwidth applications." A spokeswoman for Vodafone - which paid £6bn for its UK licence - also dismissed the claims and insisted 3G technology would offer services to the consumer that would justify the high costs. She said: "We believe video will be one of the premium services consumers are prepared to pay for."