We have spent a lot of time in recent months studying the specifications for "Uu", the UMTS 3G subscriber interface. The spec is an obfuscated mess and the experts who publish books seem to disagree on a lot of critical details. In fact, the literature is so inconsistent that we are starting a public wiki-based documentation project.
In its basic form (non-HSPA), UMTS can deliver 384 kb/s per channel with up to 4 such channels active at once, assuming good link margins, small delay spreads, good power control, proper phase of moon, low traffic levels in surrounding cells, and generally clean living and happy thoughts on the part of everyone involved. That's just over 1.5 Mb/s on a really, really good day. To do this, UMTS musters just about all of the fancy math that the 1990's had to offer: orthogonal spreading codes (at least, orthogonal until they hit the real world), turbo codes, rake receivers, multisensor diversity demodulators. In exchange for all of this complexity you get roughly half (yes, half) the usable bit rate that you could get from an EDGE-style PSK/TDMA interface in the same bandwidth, except that the PSK/TDMA approach would provide more solid QoS guarantees, use a lot fewer transistors and be more power-efficient due to smaller crest factors in the amplifiers.
So, you might ask, why all of the new complexity if we get no performance advantage? Because simple approaches don't produce enough new intellectual property to keep the usual suspects in business. If you just take the GSM/GPRS/EDGE specification and change some parameters (like symbol rate and number of timeslots) you can get a very efficient, flexible system, but you won't have a much fodder for IEEE papers. Worse yet, you don't generate a lot of new patents, and with a lot of the patents on 2.xG systems expiring early in this decade, the NEPs needed a new gravy train. This complexity also deters small players from building their own UMTS implementations. (We have taken that as a challenge, but then we are unreasonable people.)
And what did UMTS do for the carriers? It nearly killed them. They overbid for the spectrum, barely had enough money left to roll out these really expensive new networks and when it was over they discovered that all their customers really wanted was better coverage and lower bills, neither of which have anything to do with UMTS. (The iPhone later proved that lack of demand for data was mostly due to the carriers' walled-garden approach to the itnernet, but that's fodder for a different post.) The killer app for the next five years turned out to be text messaging and economists got to write lots of papers saying things like "We conclude that the rationalization of bidding in the United Kingdom’s UMTS auction remains problematic." And just as the carriers are starting to recover from UMTS, the usual suspects start pushing the next shiny, new thing: LTE/IMS.