The option value of the UK 3G Telecom licences: Was too much paid?

In this article the aggregate option value of the UK 3G telecom licences is evaluated. Revenues, capital and opertaing costs of UMTS business are calculated for the period of licences’ duration and are employed to show that the aggregate revenue extracted by the UK’s Government is (slightly) lower than the aggregate price of licences paid by winning telecom companies.