The Treasury could miss out on a multibillion-pound windfall after Ofcom revealed that it will waive its right to hold an auction for the renewal of 3G licences in 2021.

Ofcom, the telecoms industry regulator, is understood to be sympathetic to lobbying from the mobile companies for an indefinite extension of their existing 3G licences when they expire.

However, such a plan would force the Treasury to forgo the potential multibillion payout that could result from making Vodafone, Orange, O2 and T-Mobile rebid for the right to use the licences.

Sources at the Treasury, which is already in talks with Ofcom about the strategy for renewal, insisted that the “default position” when the licences expire would be for another round of bids similar to the one that took place in 2000 at the height of the dot-com boom.

However, Ofcom has never set a formal policy around the renewal of the licences. There was no mention of it in the information memorandum that was issued alongside the licences seven years ago.

The regulator insisted yesterday that no decisions about licence renewal had yet been taken. “The management of spectrum is Ofcom’s responsibility,” a spokesman said.

The Treasury received a £22.5 billion windfall from the original 3G auction. The money played a crucial role in helping the Government to pay down national debt. It helped to flatter the public finance numbers and created a bigger cushion for the borrowing the Chancellor has since used to help finance public spending.

However, the mobile operators paid over the odds for a technology that failed to live up to the hype preceeding it.

In its early days, the new service was beset with glitches, with one executive famously describing the handsets as hot enough to fry an egg on. Today, the bulk of mobile revenues still comes from ordinary voice and text messages, not 3G data services.

Ofcom’s policy around the existing 3G licences has been brought to the fore by factors including a fresh 3G auction planned for this year. Spectrum in the so-called “3G expansion band” is to be sold.

Ofcom has said that it planned to make those new licences indefinite and operators said that it would be inconsistent not to do the same with the existing 3G licences.

Equally though, experts said that an indefinite extension of the existing licences could bring the threat of legal action from players who may have participated in the original auction if that had been a term of the licence.

Operators including Vodafone and O2 are already lobbying Ofcom for their licences to be extended indefinitely.

In a recent submission to the regulator, Vodafone suggested that it should consider rewarding those operators that had met their licence obligations – such as ensuring that their 3G services reached 80 per cent of the population – with “an undated licence period”.

A spokesman for O2 said: “We would look for the extension to be treated in the same way as the new ones – to be indefinite.”

A Treasury spokesman said: “The Government is committed to ensuring the most efficient use of the spectrum after 2021.”

The mobile operators O2 and 3 have already raised separate objections over the requirement, under the existing licences, to meet 80 per cent population coverage. 3, which has achieved the target, has told Ofcom that failure to ensure full compliance by other operators would be “highly discriminatory”. Although has raised the prospect of legal action itself, O2 declared that it “would be prudent for a reasonable regulator to ensure that the obligation is lawful”.

The environment since the 3G licences were issued has changed, it said. It is now clear, for example, that the technology, for which the mobile operators paid £22 billion, has not met expectations.

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