Italy's national audit committee has launched an inquiry into possible irregularities in the government's auction of licences for the latest generation of mobile telephones licences, known as UMTS.

The announcement followed complaints that the state had been deprived of vast sums in potential revenue.

The auctions raised little over ten billion dollars -- half as much as the government's estimates -- after one bidder Blu dropped out, leaving just five in the running for the five UMTS licences.

Correspondents say the amount has been seen as an embarrassment to the Italian government, which had hoped to replicate hugely profitable auctions held in Britain and Germany.

From the newsroom of the BBC World Service