Yahoo Finance Sainsbury's To Launch Mobile Phone Service
Supermarket chain Sainsbury (LSE: SBRY.L - news) 's has announced a plan to enter the mobile phone service market as it seeks to expand from its core grocery business.
The firm, which trails Tesco (Other OTC: TSCDY - news) and Asda by annual revenue, has teamed up with Vodafone to create the "Mobile by Sainsbury's" network service.
Details of the joint venture's product range and pricing will be announced at a launch later this summer.
Sainsbury's currently sells mobile phones and offers prepay SIM cards for other networks, but does not provide its own virtual network service.
Tesco has been offering mobile services since 2003.
Going into new business markets forms a core part of Sainsbury's strategy.
Over the last year it has entered the markets for eBooks, mp3 downloads and video on demand services.
In May, the firm bought out the 50% it did not own of the Sainsbury's Bank joint venture with Lloyds Banking Group (LSE: LLOY.L - news) .
Last month Sainsbury's outperformed Tesco with a rise in first-quarter like-for-like sales.
Shares in the firm started down slightly early Monday before reaching 1.04% up in mid-afternoon trades.
Meanwhile, competition in the pay-as-you-go mobile market has been stepped up after operator Three (3) unveiled a "back-to-basics" deal that reverses the trend towards bundled deals.
In a move that could spark a price war in a neglected area of the market, the smallest of the UK's four main mobile players is offering a calls rate of 3p a minute, 2p a text and 1p per 1MB of web data.
Unlike the other "confusing" 179 pay-as-you-go deals on the market, it said there would be no bundles or time limits on how quickly customers must use up their phone credit.
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