E-Minister Patricia Hewitt yesterday quashed rumours that mobile phone operators may receive refunds from the government on cash shelled out for 3G (third-generation) licences.
In what some commentators have termed a set up by mobile firms, rumours have been circulating that the government would help British Telecommunications PLC, Orange SA, Vodafone Group PLC, Hutchison Telephone Co. Ltd. and France Telecom SA cut their massive debts of between £22.5 billion and £30 billion.
"You cannot have an auction and then, long after you award [licences], say things have changed and change the terms of the licence," said Hewitt.
She went on to add any interference in the auction process by the government would "undermine the integrity of all future auctions".
It now looks as though telcos will have to carry the burden, which, according to many analysts and industry commentators, means the end user will ultimately pay more.
"We are of course disappointed," said a spokesperson at Vodafone, "and will now have to consider other ways of dealing with the debts."
"We have faith that 3G will be a success and we must stick to that," said a spokesperson at Hutchison.