O2 has fulfilled its contractual obligations to roll out 3G services to four-fifths of the UK population.

Ofcom warned the company in February that it had not managed to extend its 3G coverage under the terms of its licence.

Failure to do so would have meant an early termination of O2's licence, potentially costing the company £40m.

"O2 has now met its obligation to roll out its 3G services to at least 80 per cent of the UK population," said Ofcom in a statement.

"Ofcom will conduct a further assessment to ensure that all licensees remain in compliance on 31 December 2008."

The other four mobile phone operators - H3G, Orange, T-Mobile and Vodafone - all satisfied the regulator that their 3G networks covered enough of the population last year.