The Ape Bot

In a strategic move to increase its annual profits through non-core business to £1 billion, grocery retail giant Tesco has announced that it will more than double the number of mobile outlets in its stores by the end of 2009. The number of these in-store outlets, which sell both mobile phone handsets and mobile broadband services and products, is set to increase from 41 to 100.

This move is being seen as very important for the UK mobilebroadband retail sector. Since Tesco is the third largest retail company in Europe, it is quite understandable that this latest manoeuvre could have far-reaching consequences. Shaun Collins, who is an analyst at CCS Insight, a telecoms consultancy firm, says that Tesco’s geographical reach, expert market research, and brand-loyal customers must in no way be underestimated.

However, Collins also points out that Tesco’s move, though excellent from a strategic point of view, is on a relatively smaller scale. This means that the rumours that Tesco will quickly emerge as a rival to Carphone Warehouse, an established retailer in mobile broadband, are probably unfounded. Carphone Warehouse currently has 900 stores across the UK, which greatly exceeds the number Tesco will have even after their expansion is complete. In order to cause a drastic change in the mobile broadband retail market, a larger move than Tesco’s present expansion must be contemplated.