The European Union's executive arm said operators were currently holding off investing in technology allowing communications between satellites and handheld devices because of the burden of getting licences from each member state.

The Commission proposed to take the selection of companies over from member states in hope of creating a single European market for high-speed Internet access and even television on hand-held devices by using satellites.

Since the radio signals would rely on satellites, operators could offer the services in far-flung places not currently covered by base stations for mobile telephone networks.

Satellite communication services are already available but at a high radio frequency that requires often clunky equipment that has held back their wider use except for in geographically isolated places.

The new licencing aims to open the way for services at the lower two gigahertz band, which would allow hand-held devices such as normal mobile phones to be used.

So far operators have not invested in services at two gigahertz because they have to get licences from individual EU countries, which prevents them from reaping economies of scale, according to the Commission.

The EU executive is hoping to get backing from member states and the European Parliament by the end of the year or the beginning of 2008, paving the way for the selection of companies in early 2009, according to spokesman Martin Selmayr.

On that basis, the selected companies could then start launching satellites so that commercial activities could begin in 2011.

Candidates would be selected according to the technical and commercial quality of their proposals as well as their geographic coverage, consumer and competitive benefits, and possible public sector uses, such as disaster relief.

Satellite companies Astrium, Eutelsat, SES Astra and Inmarsat have already shown interest in applying for eventual selection.

Although companies would be selected and authorised by the Commission, member states would still have to issue individual licences.

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