Tesco has linked up with Cable & Wireless to provide broadband and home phone services.
The retailer said the five-year deal would help in its drive to become one of the UK’s leading providers of telecoms products and services.
It has a medium-term target of £2bn in annual sales and £200m in profits.
“Tesco Mobile has shown that we can be successful in telecoms if we have the right partners and the right offer,” said Tesco Telecoms chief executive Lance Batchelor.
“The new agreement with Cable & Wireless enables us to offer very competitive pricing.”
Tesco Telecoms adds 100 jobs in Liverpool (9 September 2009)
Tesco Mobile finds new brand image (19 July 2008)