O2 3G shortfall could cost it £40 million

Oops. I bet the execs at O2 are not best please at the moment, after Ofcom has delivered a severe slap on the wrist – a slap on the wrist that could be worth up to £40 million.

The problem? 3G network coverage. When 3G licences were doled out in 2000, O2 dug deep and paid £4 billion or so. One of the conditions it signed up on buying its licence was to cover 80 percent of the population with its 3G network by the end of this year – a figure the regulator says it’s failed to meet by around 5 percent or 2.5 million people.

If O2 doesn’t get the network out to the full 80 percent by the end of June this year, it could see its 3G licence cut short by four months, a sanction worth around £40 million. With that kind of cash at stake, I reckon those 2.5 million people can expect to get their 3G any time soon.