Tesco to start its own mobile phone service from Monday

Supermarket chain Tesco is to start its own mobile phone service from Monday, targeting families and children in an attempt to take 5 per cent of the Irish market within three years. Claire Shoesmithreports.

At the launch of the service, which will use O2's network and take the 089 prefix, Tom Britten, general manager of Tesco Mobile, yesterday said he believed there was a gap in the market for a simple, easy-to-use mobile phone package.

"Complicated and expensive pricing plans have confused Irish consumers for long enough," he said. "Apart from great value, Tesco Mobile will introduce transparency and simplicity through one easy-to-understand pricing package with no hidden extras."

Customers of Tesco Mobile will pay 20 cents a minute for calls to any network at any time, with all text messages costing nine cents.

Special bundles, In Touch 10 (10 days) and In Touch 30 (30 days), will provide unlimited calls, texts and picture messages for €4.99 and €11.99 respectively, but only to other Tesco Mobile customers.

Mr Britten said prepaid mobile handsets, starting at €29, would be available in 48 Tesco stores from Monday.

Top-up facilities would be on offer at 97 Tesco outlets and 3,000 other independent locations, including at newsagents and petrol stations.

At first glance Tesco's new service, which will be Ireland's first virtual network - where the service provider piggybacks on another company's network to provide the service - appears to offer best value for relatively infrequent mobile phone users. However, similar price tariffs are offered by Meteor's Anytime Plus plan.

The other providers' tariffs vary depending on which network you are calling.

Ireland has one of the highest levels of mobile phone usage in Europe, with the average customer spending €44 a month, compared with just under €30 elsewhere in Europe.

Currently about 74 per cent of mobile phone users have a prepay handset, according to Tesco Ireland.

Yesterday's launch follows the rollout of the service in the UK in October 2003. It now claims to be the fastest growing network there with 1.6 million customers.