Not content with dominating the food market and carving out stakes in the entertainment and clothes markets among others, Tesco said it had beaten its initial rollout targets for the mobile service, which combines low prices with Clubcard loyalty points for customers.
As well as loyalty points for buying handsets and call time, Tesco has tempted people away from other mobile phone services with offers such as half-price calls and texts to your three favourite numbers.
Andy Dewhurst, chief executive of Tesco telecoms, said: "Tesco's core values have been linked with a mobile service, making this a hugely successful start. Consumers are turning to Tesco Mobile because they want convenience and simplicity."
He added: "We are delighted with this achievement as it shows we are giving customers something new and appealing. People trust the Tesco brand and we are confident that we will continue to grow rapidly and attract many new customers."
The 50:50 joint venture with 02 has already been rated the number one pay-as-you-go mobile service for its tariff and for customer service, according to research carried out by CFI Group for the retailer.
Matthew Key, chief financial officer at O2 UK and Tesco Mobile chairman, said: "The customers that Tesco Mobile attracts perfectly complement those which O2 target and we are confident that this venture will see continued success."
The success of Tesco Mobile is partly built on the retailer's lead in the mobile phone airtime sales market, where it has a share of 12% for vouchers and electronic top-up, according to Taylor Nelson Sofres.
As well as its mobile service, Tesco has made other inroads in the telecoms market with the launch of Tesco home phone and a bespoke directory enquiries service.
Last month, entered the movie rental market with its own online DVD offering. The new service sees Tesco providing site visitors with more than 15,000 titles to rent. Subscribers can rent an unlimited number of DVDs for a flat-rate monthly fee and get the chance to earn Clubcard points.
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