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With pretty much perfect timing, when everyone is worrying about rising costs, Lidl has announced that it's moving into the telecommunications business. The German supermarket giant has confirmed that it plans to launch a low-cost mobile phone service across 30 countries by the end of this year, and Spain is expected to be among them.

 

Rather than building its own network from scratch, Lidl will operate as a mobile virtual network operator, essentially piggybacking on existing infrastructure to offer phone services without the eye-watering cost of setting up towers and cables.

 

To make it happen, Lidl's parent company the Schwarz Group has taken a 9.9% stake in communications provider 1GLOBAL, which already operates in Spain using Orange's network.

The service will be offered through the Lidl Plus app, which already has more than 100 million users worldwide.

 

Lidl International executive Julian Beer described the plan as offering "simple connectivity" to its existing customer base, which is a fairly modest way of putting it given the potential scale of the operation.

 

Lidl has already been running mobile services in Germany, Austria and Switzerland, and the expansion to up to 30 new markets including Spain, the UK, the US and France would represent a significant step up. The company hasn't yet confirmed the exact order in which countries will come on board.

 

It's not entirely uncharted territory, since Fintech companies like Revolut, Klarna and N26 have already moved into mobile services in recent years, using the same logic of keeping existing customers engaged while finding new ways to grow revenue.