Plug pulled on future 3G operator

OXFORD, United Kingdom—Broadband Mobile, a third-generation (3G) joint venture between Finland’s Sonera and Norway-based Enitel, has been closed down before it even started operations. The company, which paid more than US$22 million to the Norwegian government for its 3G license in October of last year, has now been declared bankruptcy.
The collapse of Broadband Mobile is said to have been due to Sonera’s withdrawal from the joint venture after it had failed in its ambitions to acquire a 3G license in Sweden, making its planned pan-Scandinavian network impossible. Sonera confirmed that it would be returning its 3G cell phone license to the Norwegian government and planned to report a US$16 million write-off for the failed venture. Analysts said that Sonera’s move was hastened by its wish to refocus on its core operations as it attempts to cut back on expensive projects and attract outside investors.
This came as the secretary-general of the International Telecommunication Union (ITU), Yoshio Utsumi, said worldwide 3G services would now begin considerably later than the previously anticipated start period of 2001. He added that telecom operators in the United States and Europe had invested large and perhaps excessive amounts of capital in securing spectrum rights, and were now faced with uncertainty regarding the profitability of 3G services.