The irony: In spite of the titanic proportions being spent, this is nothing but a leap in the dark. For one, no one knows if consumers will want the new services-or even what exactly these services will be. And if the customer response to WAP (which has been given the royal ignore by subscribers) is any indication, then the industry has cause for worry.

Add to this, the fact that the success or failure of 3G will depend on the usefulness and the cleverness of the services and applications that can be reached, which incidentally will neither be developed by the infrastructure manufacturer nor by the handset manufacturer as they are only facilitators of this technology.

Third, the mobile phone manufacturers run the risk of competition from powerful handheld computers with different skills. Powerful brands such as Dell, Palm and Sony would challenge the traditional handset makers. The mobile phone industry is careful not to claim that the handsets will replace PCs for surfing the Internet, but claims that there will be huge interest in services that exploit what is different about the mobile phone that is always with you.

But even this concept has two major flaws. First, time and location-specific services are likely to be low in value. After all, how much will you pay to be guided to the nearest petrol pump or a restaurant? Something certainly, but not very much, and the money probably would go to the provider and not to the utility that connects him to his customer.

Second, these simple services do not need the immense bandwidth that 3G provides. While, optimistic operators claim to provide movie clips for kids, or video conferencing for business executives on the move, trouble is that mobility requires handsets to be small and light and even with colour display tiny screens are tiny screens.

Moreover, the service provider will need to be earning at least half their revenues from transactions and data traffic within seven or eight years. When equipment manufacturers and telcos try to explain how money would be made from 3G, they do little to allay the fear of the investors.

Shares of most telecom companies tumble as fears have grown and debts have mounted. Operators such as Deutsche Telekom, France Telecom and British Telecom have suffered credit rating downgrades, with the threat of more to come. This is a situation where only the paranoid would survive.

Incidentally, the single largest beneficiary of 3G have been governments, who are collecting huge amounts of money for allocating the spectrum. In this regard, Europe is leading the world. In other parts of the world, the stakes are not yet so great. In Asia, Japanese and South Koreans firms have been given 3G licenses almost free of charge. The European spectrum auctionhave certainly resulted in massive transfer of wealth from the shareholders to the governments.

But this is not to say that all hope is lost. Just as consumers can sometimes surprise technologies such as WAP and Iridium, they can also surprise and embrace technologies like SMS. A decade ago no body would have dared to predict the pervasiveness of today's mobile phones, while cost and risk of 3G is frightening, the alternative is to live with near saturated markets and declining user revenues.

It may not be a disaster for every one, some companies may turn out to win this gamble. Companies with superior financial muscle will clear this hurdle. Things which are far fetched now can becomean every day habit and this change could be quick and remarkable. However financially stretched telecom companies may have to break themselves to pay their 3G bills, because operators cannot afford to sit on their expensive licenses. In this background, Europe will get 3G systems quickly and at competitive prices. The customers and shareholders would benefit from efficient operators.

If 3G proves the doubters wrong and the mobile Internet takes off, for once Europe will be ahead of the United States. In this glamorous race of new technology, Japan - which incidentally has stayed away from CDMA/GSMlobbies and has witnessed phenomenal success of i-mode Internet services - is destined to compete fiercely for a market share in this segment. The writer is president, corporate affairs, with Shyam Telecom Group. The viewsexpressed above are his own