The hidden costs of 3G

Infamous MIT professor, Nicholas Negroponte, has taken his latest trip to the UK as his cue to criticise the government's über-profitable auction for next-generation (3G) phone network licences.

Negroponte - a professional crystal ball gazer on all things Internet - took almost personal offence at the £22.5bn now resting in Gordon Brown's coffers.

The UK has set a "disastrous and economically unsustainable" precedent, he said, which will leave the UK in a digital underclass, as few of us will be able to benefit from Europe's version of 3G, UMTS.

What's more, he expects France, Germany and everyone else with UMTS spectrum left to sell to rush towards the auction model like lawyers toward a car crash.

He's right, in Germany's case. And even though France is now making noises in the opposite direction, it's a very strong government that can resist billions in cash for selling air.

Brown's profit is our loss as potential users. For years we have accused BT - with good reason - of holding back the digital economy with its charges for Internet access.

One Freeserve and some Oftel interference later, the problem seems under control.

But for an encore, we've decided to handicap the next generation of access with a painful debt.

A digital economy is not just about hardcore ecommerce or large corporates buying whizzy PDAs for the executive sales staff. It's about small businesses videoconferencing with customers from handheld devices and 15-year-olds watching video clips on their mobile phones. And that's not going to happen if 3G is priced out of the reach of the majority of users.

Spain may be kicking itself now for giving away 3G licences for next to nothing. But the Spanish telcos are using the £4bn they didn't spend on a licence to develop innovative, low-cost services that UK consumers will want.

And while they'll be downloading the latest Almodóvar film to watch on the way to work, you'll still be struggling to fold your broadsheet into a manageable little square without elbowing the person next to you.

The next generation of UK Internet access looks distressingly similar to the first.