Lidl is set to shake up the telecom industry by launching affordable mobile phone plans in several new countries later this year, positioning the German discount supermarket as the latest disruptor to traditional telecom operators.
Speaking to the Financial Times, the firm confirmed it was expanding beyond Germany, Austria and Switzerland with a mobile service that could eventually be available in up to 30 countries, including the UK, US, France and Spain. Lidl declined to say which markets it would target first.
To enter new markets without building its own infrastructure, Lidl’s parent company, Schwarz Group, has signed an agreement with mobile communications provider 1GLOBAL.
This will allow Lidl to operate as a mobile virtual network operator (MVNO), using wholesale access to established telecom networks, a model already employed successfully by players like Tesco Mobile and Lebara in the UK.
As part of the deal, Schwarz Group will acquire a 9.9% stake in 1GLOBAL, which holds telecom licenses and partnerships in 12 countries. The partnership enables Lidl to offer flexible, app-based mobile services without the heavy capital costs of owning spectrum or towers.
Lidl joins a growing list of non-traditional players entering the European mobile space to boost customer retention and create new revenue streams.
Fintech companies such as Revolut, Klarna, and N26 have launched or are exploring similar cheap mobile offerings, while UK neobank Monzo was reported last year to be in the early stages of developing its own service.
The mobile push represents the latest step in Schwarz Group’s strategy to develop a broader digital ecosystem around its roughly 14,000 Lidl and Kaufland stores across Europe and beyond.
Through its Schwarz Digits unit, the group has rapidly expanded into cloud computing, cybersecurity services, and investments in artificial intelligence startups. Adding mobile connectivity fits into this ambition of turning everyday shoppers into users of a wider range of digital services.
Lidl’s existing “Lidl Connect” service in its home markets has already attracted around two million customers, providing a proven base for international scaling.
Leave a Reply