3G will cost Vodafone £22bn

When 3G licences went under the hammer back in 2000, and over £22bn left the operators' pockets as a result, it seems that the real cost of a third generation launch has still not stopped rising.

According to figures in the Observer, Vodafone will have spent over £22bn on 3G before the handsets even hit the shops. As well as the original licence cost of almost £6bn, Vodafone has decided to invest nearly £100m in marketing and advertising to try and get the UK upgrading to third generation hardware and services, the paper said.

Another £8bn was spent on infrastructure, including base stations, and a smaller portion of the cash went towards research and development.

With Vodafone's 3G launch expected this week and a £22bn bill hanging over the operator, the stakes are high. However, Vodafone will be the first to market out of the 'big four' operator with its third generation offering: Orange is the only other operator to talk about going public with consumer 3G but is yet to set a date.