Tesco Mobile offering monthly discount if customers agree to view ads on their phone

Tesco Mobile has launched a new mobile phone deal called Tesco Mobile Xtras which gives customers a discount on their monthly bill in return for viewing adverts on their phone.

The new model is the opposite of what O2 is considering introducing – a complete ad-free service.

But this new deal being offered by Tesco could work out well, especially among cost-conscious consumers – as long as it does not become too much of an annoyance.

Advertising on smartphone
Tesco’s new deal, which involves showing ads to phone users in return for a discounted monthly rate, could appeal to those who prioritise costs.

“This innovative new service is a UK exclusive and we’re excited that our customers get to benefit first from this new technology,” said Anthony Vollmer, chief executive of Tesco Mobile.

Tesco Mobile Android customers who opt in for the deal can expect to occasionally see a static advert or deal pop up when they try to unlock their phone.

In return for opting in, customers will see £3 a month subtracted from their monthly bill – equal to savings of £36 per year – in addition to 200MB of extra data every month – more than enough cover the extra usage required by the app which shows the promoted content.

Matthew Howett, an analyst with research firm Ovum, told the BBC: “Essentially it comes down to consumer choice. Some will happily accept advertising to enjoy free content, others would rather pay to avoid it.

“It does seem the time has come to have a debate about the current models and idea of putting the consumer in control – perhaps through a consumer charter.”

The service will initially only be available for Android – the Apple iOS does not allow for that kind of functionality.