Around 2,000 European business leaders have signed a petition
calling for the governments of the UK, Germany, France, Italy and
elsewhere to reverse the effect of the auctions last year for 3G
mobile phone licences.
Meanwhile, BT’s former head of technology, Peter Cochrane, has
told the BBC’s Money Programme (due for broadcast on Wednesday)
that 3G phones may never appear and that he expects many telcos to
collapse under the financial strain of developing and running the
services. Cochrane described the auction process as “a really good
study in madness.” In the UK, Vodafone, Orange, BT Cellnet and
One-to-One paid £22 billion for licences.
Dutch telco KPN has amassed debt of €22 billion (£14 billion),
almost half of which was attributable to its purchase of a 3G
licence. It has this week announced it will sell parts of its
business to reduce its debt, possibly including its mobile phone
division.
European business association GrowthPlus, a sponsor of the new
petition, argues that at a time when European business is feeling
the impact of the stock market bubble, the effect of the 3G
licences further exacerbates the lack of capital currently
available in Europe to fund innovation and growth, because venture
capital funds have been weakened to support the purchasing of the
licences which it says across Europe cost over €130 billion (£81
billion).
"The fact is that these billions are not going to pay for new
technology, job creation or economic growth but are going straight
to government coffers," said Denis Payre, Vice-President of Growth
Plus, the founder of Business Objects, the first French company to
be listed on Nasdaq. He added:
"These auctions should be seen for what they
truly are: taxation. The largest, most damaging tax of all, as it
is not based on the production of success, wealth or growth; it is
being taken up-front before anything of service or value is
created."
"Europe is currently the world's leader in mobile technology.
Only reversal of the 3G license auctions can ensure that enough
capital remains available to support innovation and maintain this
leadership position", argues Declan J. Ganley, President of
GrowthPlus Ireland and the person responsible for leading the
campaign across Europe.
