At the same time, the operator has extended the flat rate of its family tariff to encompass international calls, making it as cheap to call the other side of the world as it is to call the house next door.

Tesco Mobile has also announced the expansion of its retail base into 60 Metro stores, bringing high street customers access to its great value network.

Tesco Mobile Value Tariff:

The flat rate UK calls and texts only Value tariff will be available to customers who purchase a Value SIM card on www.tesco.com or by phone, and complements the existing Tesco Mobile family tariff as an ideal ‘back to basics’ solution.

With the Value tariff calls are just 15p a minute and texts just 5p each, without any need to pay upfront for a bundle of texts to receive the low rate.

One of the main benefits of the new Value tariff is its convenience. Customers will be able to top up in-store by e-voucher as well as online and by credit card over the phone.

There are no hidden costs with the Value tariff. Customers won’t have to pay to top-up their mobile credit and Value airtime will not expire after any length of time.

There will also be no minimum top-up charge to start using the service and no cancellation fee if a customer wants to leave.

Tesco Mobile International Rates:

As of today, Tesco Mobile has extended its flat rate of just 20p a minute to encompass calls to the main international calling destinations.

Customers will also be able to text any mobile in the world for just 20p.

With Tesco Mobile’s family tariff it is now as cheap to call Kingston, Jamaica as it is to call Kingston in Surrey.

A further 141 countries will be just 40p a minute making Tesco Mobile’s international rates the simplest available.

Andy Dewhurst, Chief executive officer of Tesco Telecoms commented:

"Mobile users don’t think twice about using their handset to call friends and family in the UK but until now would never have had the confidence in price to call abroad from a mobile.

"With our family tariff’s flat rate, our customers can call UK numbers, cross-network mobile numbers and international numbers whenever they want and know they are getting great value calls at all times."

Tesco Mobile expands retail base:

Tesco Mobile has also announced the first step into a broader high-street distribution with the availability of handsets and SIM packs in up to 60 Metro stores.

This move means the 750,000 customers who visit a Metro store on the high street every day will get convenient access to the Tesco Mobile network.

Andy Dewhurst continued:

"These new benefits will be a hit with customers who know they can trust Tesco Mobile for best value.

"Tesco is synonymous with simplicity, convenience and of course, great value. Our confidence in the success of this business means we will continue to listen to customers and deliver the new benefits and services they want.

"Whether that be a back to basics tariff for UK-only calls and texts, extending our flat rate so mobile users don’t have to worry about the cost of international calls or expanding our retail base to make access to our network and handset range as simple and convenient as possible."

Notes to editors:

Tesco Mobile was recently voted number one mobile operator for customer satisfaction. (CFI – March 2005). The joint venture currently has over half a million customers.

For Further Information please contact:

Joanna Kinloch,Tesco Mobile

07770 435 943 or at joanna.kinloch@tescomobile.com

Julie McGuckian, Tesco PLC

01992 646 143 or at Julie.mcguckian@uk.tesco.com

About Tesco Mobile:

Tesco Mobile is a 50:50 joint venture between Tesco and O2. The company sells exclusively Tesco Mobile branded services in Tesco stores across the UK using O2’s technology and network. The service gives Tesco Mobile customers value, simplicity and choice, offering them supermarket style offers and the chance to earn Clubcard points when buying handsets and call time.

About O2:

O2 is a leading provider of mobile services to consumers and businesses in the UK. It is the leader in non-voice services, including text, media messaging, games, music and video, as well as always on data connections via GPRS, 3G and WLAN. Every month, O2’s 14.6 million customers send a billion text messages. O2 (UK) is a subsidiary of O2 plc which also owns O2 branded mobile operators in Ireland and Germany as well as the O2 Airwave emergency services network in the UK