Loophole blow to 3G firms

date: 11th December 2000, source: The Times

A FINNISH professor has discovered a technical loophole that could eradicate the need for mobile phone licences worth nearly £60 billion.

Hannu Kari, a professor at Helsinki University of Technology, has developed software that could allow companies without so-called “3G” licences to launch mobile Internet services in big cities.

The software, which has been provisionally named Dynamics HUT Mobile IP, has been adopted by one of Finland’s biggest Internet service providers, Jippii Group.

The company claims the software is capable of allowing mobile phone users to access the Internet at 11Mbps (megabits per second) — several hundred times the speed of conventional modems.

Jippii has used the software to launch a mobile Internet service called Freedom in Helsinki, and it plans to launch similar services in London and Frankfurt next year.

The news will come as a blow to Europe’s telecoms companies, which are already facing fierce criticism for taking out huge loans to pay for 3G licences. Five companies, including Vodafone and BT Cellnet, paid a total of £22.5 billion for 3G licences in Britain.

In an interview with The Times, Harri Aho, a vice-president at Jippii, said he hoped to launch a mobile Internet service in London before any of the companies that paid nearly £5 billion each for 3G licences.

Professor Kari’s software works by using a very high 2.4GHz radio frequency that has not been licensed by any European country. Mr Aho claims he has been assured by European Union officials that it will remain free.

The frequency used by Jippii’s Freedom service means the company will need to build hundreds of “base stations” on top of buildings in the areas it wants to cover.

However, Jippii claims that the equipment costs between five and ten times less than that needed to build 3G networks. Jippii has already persuaded Sagem, a French company, to make mobile phone handsets that are compatible with both traditional GSM mobile services and Freedom.

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