3G is a standard for mobile telephone systems of the third generation. The first generation was comprised of analogue mobile telephone systems, the second of digital PCS (personal communications services or systems). The unique feature of 3G is that multiple data packets can be transmitted simultaneously.

Along with W-CDMA (Wideband Code Division Multiple Access), 3G triggered a great deal of excitement in the late 1990s. Advocates of the technology referred to it as a killer application, as it provides a means for the simul-
taneous transmission of voice data (i.e. telephone calls) and other data, such as music, photos, videos, e-mail messages, SMS and information downloads. Moreover, 3G networks are compatible with a number of contem-
porary and future wireless technologies, including GSM, SDMA, TSMA, WCDMA, CDMA2000, UMTS and EDGE. This flexibility appeared to guarantee the future of 3G as the dominant standard.

The implementation of 3G technology has progressed at a slower pace than expected, due among other things to the high costs of upgrading systems to accommodate the broader spectrum. Furthermore, the older 2G networks ordinarily did not use the same frequencies as the 3G networks (except in the U.S.), and license fees were extremely high, especially in Europe. The expansion of 3G networks is now progressing more rapidly. A market share of 60% is expected in Europe by the year 2010.

(Source: analysis by Deutschen Bank Research, April 2006, German language)