3G – Third Generation Mobile Communications

The introduction and roll-out of third-generation mobile communications in Europe is being hampered by different factors: the economic slowdown, the financial problems of the mobile telecoms sector which is burdened with extremely heavy licencing and infrastructure costs, and the lack of 3G devices and services. The EU is trying to create a stable regulatory environment for a harmonised introduction of these new mobile systems.

The 'first generation' of analogue mobile systems was followed by GSM (so-called 2G). Currently 12 countries have issued '3G' or 'third generation mobile communications' licenses and in 3 countries (Greece, Ireland, Luxembourg) licences are pending. 3G mobile communications combine wireless mobile technology with data transmission capacities. '3G' officially refers to systems and services based on the ITU family of standards under its International Mobile Telecommunications programme 'IMT-2000'. The first 3G services on the market in Europe are expected early 2003. 

In 1998 the European Commission stipulated that Member States reserve at least one 3G license for the Universal Mobile Telecommunications System (UMTS). UMTS is generally considered one of the four 3G mobile systems. It has left it up to Member States to decide on the licensing terms. In practice two main licensing schemes were used: the auction and the 'beauty parade'. In the auction system the licenses were given to the highest bidders (which sometimes turned out to be the minimum price as not always more parties than licenses participated). In the 'beauty parade' contestants could be assigned a license based on qualitative criteria.

In March 2001, the Commission issued a Communication on the introduction of third generation mobile communications in the EU. On 12 June 2002, it followed up with a Communication "Towards the Full Roll-Out of Third Generation Mobile Communications". The Communication provides an overview of the situation of the 3G sector today, analyses the major financial, technical and regulatory challenges associated with the roll-out of 3G networks and services and identifies options to support this process.

The Seville Council (21-22 June 2002) took note of the Commission's report on the remaining barriers to the roll-out of 3rd generation mobile communications networks and services and called upon all relevant administrations to act to overcome difficulties encountered in the physical deployment of networks. It also invited the Commission to report back to the Copenhagen European Council (December 2002) on this issue and on the remaining barriers to open platforms in digital television and third-generation mobile communications, on the development of eCommerce and eGovernment and on the role that electronic identification and authentification systems could play in this context.

The main issues in the debate on the third generation communication systems are: 

  • The high fees for the licenses;
  • The great differences in the licensing terms;
  • The current high debt of many telecommunication companies, making it more of a challenge to build the necessary infrastructure for 3G;
  • Member State support to the financially troubled operators;
  • health aspects of the effects of electromagnetic waves;

Asked by EURACTIV, Mr Bartholomew, Director of the European Telecommunications Network Operators association (ETNO), says the current situation in the European 3G market is the consequence of the chaotic approach by governments in the attribution of the licenses. This approach has led to great losses for the different telecommunication network operators, leading to a delay in the roll out of the necessary infrastructure and services. A further delay is being caused by a "wrangle of environmental laws" to set up the infrastructure. A regulatory initiative now would be "too little, too late". A better approach would be a "hands off policy" with for the short term actions like in France: lowering the price of the licence. 

The European Consumers Organisation (BEUC), states that the mobile industry's so-called 'virtuous' circle of increasing investments, lower tariffs, increasing demand, service innovation has in many ways failed to work to the benefit of consumers, which are faced with numerous issues in this self-acclaimed 'competitive' market. Transparency towards consumers and competitivity, however, should remain very important.

The European Information, Communications and Consumer Electronics Technology Industry Association (EICTA) says that the experience of the 3G licensing process shows the necessity of a strongly co-ordinated approach of electronic communications regulation. EICTA therefore urges the Member States to work together with the Commission and the European Parliament to improve the co-ordination of electronic communications regulation and methods for granting licenses covering the assignment of relevant frequency bands.

  • Member States have committed to produce a comprehensive broadband strategy by the end of 2003.
  • By 2005 all public administrations should be connected to broadband.
  • By 2005, the ultimate aim is that half of all internet connections in Europe are broadband connections.

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