Another dropout in 3G licence race

Telefonica dropped out of the race for the UK's third-generation (3G) mobile phone licences today, as the bids topped £21bn.

The Spanish telecoms group has withdrawn in Round 133 of the auction, leaving just six remaining players able to bid for the five radio spectrum licences.

Third-generation mobile networks enable high-bandwidth wireless transmissions. Services are expected to include video, audio and streaming data on the move.

The auction will be temporarily suspended while the remaining bidders are consulted on the size of minimum raises in future rounds.

Telefonica is the seventh bidder to pull out of the race, leaving just six out of the original 13 bidders in the auction at the end of Round 133.

One.Tel, 3GUK (owned by Irish telco Eircom), US group Crescent Wireless, SpectrumCo, which includes Virgin and Tesco, Epsilon Tele.com, a subsidiary of Japanese bank Nomura, and WorldCom have all withdrawn.

The total bids for the five licences, which will enable operators to build and run high-speed wireless networks, topped £21.2bn at the end of Round 133.

At the end of the round, Vodafone led the bidding at $5.67bn for Licence B, which offers the most bandwidth. Canadian group TIW led bidding for Licence A with £4.38bn. NTL leads Licence C bidding with £3.75bn, One 2 One leads Licence D with £3.68bn and BT3G leads Licence E with £3.74bn.

The remaining company, which is eligible to bid, is UK-based mobile phone giant Orange.