Vodafone puts 3G on hold in Czech Republic

Europe’s market for 3G (third-generation) high-speed mobile services — burdened by pricey spectrum licenses from the very start — reports yet another casualty: the Czech subsidiary of Vodafone Group has suspended its 3G plans, citing excessive costs.

After analyzing network construction costs and customer fees, the Vodafone unit decided to put 3G on hold, company spokesman Jakub Hrabovsky said Friday.

“We’re taking a step back and looking at other technologies that will deliver fast Internet access or television at good prices and quality,” he said. “Our customers aren’t willing to pay high prices for these services.”

Vodafone Czech Republic, previously owned by Canada’s Telesystem International Wireless, paid 2 billion koruna ($89 million) for a 3G mobile license in February 2005, agreeing to provide service by early 2008.

Since acquiring the license, however, the unit has made only a small investment in building out the high-speed mobile network, according to Hrabovsky

“We aren’t ruling out 3G completely,” he said. “We may decide to deploy the technology in certain areas or even consider network sharing with one of the other operators in the country.”

The Vodafone decision is one of many setbacks for 3G in Europe. Numerous operators across the continent, including Telecom Italia Mobile and Telefónica Móviles, have either pared back their construction plans or dropped out altogether.

“Vodafone has been very prudent with its 3G network construction investments,” said a manager at a telecom equipment manufacturer, speaking on condition of anonymity. “Personally, I think they’re disappointed with 3G and are waiting for the next big technology.”