Vodafone takes 3G off the hook

Mobile giant Vodafone has put the brakes on the rollout of its 3G network, because it believes the next-generation handsets won't be ready on time.

The company said it would restrict the number of base stations installed this year to 750, rather than the 1200 that were previously planned.

Vodafone doesn't believe that third generation handsets will be in customers' hands as quickly as the industry had hoped. Although due to be launched this summer, Vodafone chief executive Chris Gent said he didn't see the technology picking up until next year.

"There is, despite what some manufacturers may say, a slip in the availability of handsets," he said in an interview with the Wall Street Journal.

He added that delays could quite possibly even push the take-up of 3G into 2003.

As a result, Vodafone has opted to slow the deployment of third generation mobile phone masts - a move that will save the company some cash, by spreading the £5bn 3G budget over a longer period.

"There's no point in putting your foot down on the accelerator," Gent said.

But the delays will most likely hit the already suffering mobile companies harder. Pushing back the launch date of 3G means they will have to wait longer to recoup the billions spent in acquiring third generation mobile licences in the first place.