Orange is on track to launch commercial third-generation (3G) mobile data services in the UK by mid-2004, according to the operator's chief executive, Solomon Trujillo. The initial network will span 4,500 3G base stations estimated to cover 40 percent of the UK population, but video calls may not be offered until 2005.

So far, only Hutchison has begun commercial 3G services in the UK, though Vodafone said it will also offer a service by the end of this year. Hutchison's "3" service has been plagued by coverage and connection problems and is reported to have fewer than 25,000 subscribers, well below expectations.

Ian Keene of analyst firm Gartner doubts there will be much demand for 3G unless providers identify specific applications that will appeal to business users. "3G is stuck in the same trough of disillusionment that it has been in for a year, and it is hard to define who will rush out and do lots of data work for 3G. Cellular operators don't understand mobile business apps or how to sell them to firms," he said.

Elsewhere, IPWireless has finished interoperability testing between time division duplex (TDD) and frequency division duplex (FDD) mobile data networks, proving the two versions of 3G technology can co-exist in the same cellular infrastructure. Operators prefer FDD because TDD does not support voice. TDD offers more data bandwidth, however, is cheaper to implement, and could represent an alternative way forward for service providers wanting to minimise costs and provide data-only 3G services.