Third generation mobile phones do exist. Oh yes, they do. I met somebody who had heard of a colleague who had actually handled one. This sort of throw-away line is becoming a sick joke for most of Europe's mobile phone operators. In Britain and Germany alone, these companies have paid more than £50bn between them for licences to offer mobile internet, full-motion video and other glitzy services-they hope from next year.

That's fine. But where are the handsets? Realistically, many observers think it will be 2004, 2005 or even later before commercially-attractive handsets are generally available.

Stockbroker Merrill Lynch, for example, concludes: "Our equipment team have just moved to the view that w-CDMA (3G) equipment will not be available in volumes until 2004 against their previous view that equipment would arrive in bulk in 2003."

David Cleevely, chief executive of Analysys, the telecoms consultancy, points out: "Over the past 20 years of mobile telephony, handsets have always arrived late and in short supply."

This is being borne out by a number of suppliers including Qualcomm of the US and Alcatel of France, who have already sounded warnings of possible late delivery of 3G equipment.

Some mobile operators, however, remain sanguine. Vodafone, the world's largest, is committed to launching 3G services sometime in 2002-it is coy about divulging exactly when. The company is already creating a network of base stations in several towns and cities including Cambridge, which has ambitions to become Britain's 3G centre.

Vodafone is confident the handsets will be ready. Tim Harrabin, the executive who masterminded the company's 3G auction strategy for acquiring its licence, said he refused to allow the company to take part in the bidding until he had a working 3G phone in his hands.

However, the phone Mr Harrabin used back in 1998 was Japanese, built to Japanese 3G standards. European standards differ from Japanese standards, and both differ from the US protocol. This is the critical factor. Mr Harrabin admits he has not yet seen a working phone from any manufacturer suitable for the European market.

The fragmented nature of the world's mobile market explains why some people claim to have seen and used 3G phones while others doubt their existence.

At the time of writing, Japan was set to steal a march on the rest of the world by launching 3G services in October. There were, in fact, a number of prototype 3G handsets on the NTT DoCoMo stand at 3GSM, the mobile phone industry jamboree held last February in Cannes, France. Inquisitive showgoers were disappointed to discover, however, that they were only mock-ups. "Working" phones have been demonstrated at some trade shows, but they were linked by heavy cables to electronic "brains" behind the scenes.

The mood at Cannes was pessimistic and the industry's sense of foreboding will not have been lifted by the news that Japan Telecom, owner of J-Phone, Japan's smallest mobile operator, would delay the launch of its 3G service by some seven months to July 2002. It said the delay was due to changes to the Japanese version of the 3G standard; observers think it is because the phones will be late.

Leading Japanese telecoms manufacturers such as Matsushita, owner of the Panasonic brand, are throwing resources at the problem expected to have models ready for DoCoMo's planned launch later this year. Some will have built-in cameras, others MP3 internet music players.

But they will operate on the Japanese version of w-CDMA, the global 3G standard. The European version of w-CDMA is known as UMTS (universal mobile telephone system). There are small but significant differences between the two standards, which means the Japanese phones are unlikely to work on European networks. And in any case, European customers will initially demand a different kind of phone, a "dual-mode" handset which will be able to handle both the new w-CDMA standard for 3G and the GSM technology used in existing phones. "The availability of dual-mode handsets is critical to the success of 3G in Europe," says Michael Ralph of the San Diego-based wireless consultancy WFI, "but I am not aware of working prototypes from any western manufacturer."

The problem is that today's customers enjoy the ability to "roam" anywhere a GSM network is in place. But it will take years for operators to complete their new 3G networks. In the early days, therefore, there will be islands of new 3G services in a sea of old GSM. Few customers will be prepared to buy 3G handsets if they will only be able to enjoy

brief moments of connection to the whizzy new services envisaged. Even fewer will be prepared to do so if the phone they buy will not also connect them to the old GSM system and allow them the benefits of "roaming" while operators complete their new networks.

Combining old GSM and new UMTS systems in the same phone, however, is far from easy. John Haine, head of research for TTPCom, which designs wireless chips, says: "Building a dual-mode phone is a challenge because of the need to 'hand off' or transfer calls between the GSM and the 3G parts of the phone. It involves building another radio into the handset."

While there will always be early adopters keen to test a new technology, the dismal Wap experience-which last year introduced subscribers to a slow and scrappy version of internet-enabled mobile telephones-has warned customers off technology for technology's sake. A handset that cannot work on old and new networks would run a serious risk of falling foul of this change in sentiment.

Then there is battery life. Battery manufacturers are the unsung heroes of the mobile revolution. Over the past few years, they have greatly extended talk time and standby time while shrinking the physical dimensions of the battery, making possible phones small enough to be tucked into a bikini. In the early days, the higher power requirements of 3G will mean phones of a size that would be difficult to conceal in a Victorian bathing machine.

The screen, too, will have to be bigger and continuously backlit to cope with text andpictures from the internet. Colour will add to the drain on the battery. And, as anybody who has used a digital camera knows, a liquid crystal screen is difficult or impossible to view in sunlight.

It is easy, however, to overdo the pessimism. While the first 3G phones will undoubtedly be big and clunky and some may not work very well, in the end operators and manufacturers will collaborate to ensure that 3G is a success.

Alan Hadden, president of the Global Mobile Suppliers Association, says he believes 3G phones will be available from the middle of next year and that the combination of Wap and GPRS (2.5G) will provide a worthwhile "taster" for next generation services.

But the impression remains that plans to introduce 3G services have been rushed and that operators and manufacturers alike have had unsatisfactorily tight deadlines forced upon them.

According to Ali Pourtaheri, chief executive of Ubinetics, a British company which tests manufacturers' 3G capabilities: "We are trying to introduce 3G services four or five years earlier than we should."