LIKE a hardened gambler returning to the table for one more throw, Vodafone is offering yet another new generation of mobile telephones five years after third-generation (3G) models failed to catch on in Britain.

The company, which is the world’s largest mobile telephone operator, is spending tens of millions of pounds to put the first 3.5G phone on the market.

The phones are said to be on average four times faster than 3G phones, with a theoretical increase of 25 times faster. But yesterday many industry experts gave warning that the company might be throwing good money after bad.

Third-generation phones arrived in Britain’s shops in 2000 to much fanfare. Faster than the second generation of digital phones, which appeared in the mid-Nineties, they turned phones into mini-computers, allowing users to watch news bulletins or football highlights and download e-mails.

Phone companies spent £22.5 billion acquiring licences for the technology. Telecoms executives confidently predicted a “3G Christmas” — a surge of enthusiasm for all things third generation that would see gadgets flying off the shelves.

It failed to materialise.

The phones had glitches in the early days. Last Christmas Which? magazine was still warning its readers off them, claiming that network coverage remained limited outside major cities.

Consumers have also been put off by the cost of downloading data, particularly abroad, where the price can be 25 times the British rate. Ofcom, the telecoms watchdog, recently found that most people still did not know what 3G means.

Enter Vodafone’s 3.5G. Industry tests have shown that it can download one minute of music in four seconds and a large (30 kilobyte) image in one second.

Tim Miles, the head of Vodafone’s British business, said that the service would be introduced within the M25 from the middle of next year and in the rest of the country as compatible handsets become available. “Multimedia services will become more powerful for consumers,” he said. Bob House, of Adventis, the telecoms and technology consultants, said that the new phones made sense “because video downloads and such things still take a bit of time on 3G”.

The new phones offer “high-speed download packet access” which, he said, would make mobile data services more “satisfying” for customers. But, he added, “there is little evidence to show there is a demand for existing 3G services and this move is based on a bit of a leap of faith that consumers will want the service”.

James Barford, of Enders Analysis, a telecoms and broadcast research consultancy, was even more sceptical. “3G appears to be of little interest to consumers,” he said. “I don’t see how the same service at faster speeds will make much difference.” There would be business customers using mobile data cards to download e-mails and access the internet, he said.

As for the higher download speeds, he said: “With the current 3G service the reality is that 90 per cent of people receive speeds of only 120 kilobits per second, whereas 10 per cent receive 320kbps.”

The 3.5G will have one advantage over existing technologies that offer fast mobile broadband speeds, such as wi-fi. That is that wi-fi speeds are available now only to mobile datacard users at “hotspots” such as cafés and airports, whereas 3.5G phones will offer fast internet speeds wherever the mobile network has coverage.

However much of a gamble 3.5G may be, rival networks are already preparing to come to the table. O2 is currently testing the service.

RINGING THE CHANGES

• 3 was the first mobile company to launch 3G phones in 2003
• The new phones were dogged with technical glitches. The chief executive of one mobile company conceded the handsets were “hot enough to fry an egg on”
• Vodafone spent £5.1 billion last year in rolling out its 3G network around the world
• O2 began tests on 3.5G before it had even launched a 3G service
• A second auction of 3G mobile licences will take place in 2007. It is expected to net only one tenth of the £22.5 billion secured by the Treasury in the first auction
• Coverage for up to 60 per cent of population for 3G — and 3.5G from those offering it — should reach 80 per cent by 2008

Explore UK News

• Crime News

• Education News

• Health News

• Scotland News

Times Recommends

• Times Christmas appeal: Letter from the Editor
• Conferences — what a waste of money
• Schools supremo learns a painful lesson