Tesco, the UK-based retail giant with 20 million customers in 12 countries across Europe and Asia, today took its biggest step yet into digital commerce and content: the company launched Hudl, an own-brand, seven-inch-screened Android (Jellybean) tablet priced at £119 ($190).
The idea will be for Tesco to use the hardware to promote use of its own range of digital content and e-commerce services, and in keeping with that it will be even cheaper to buy the device for those who use the company’s Clubcard loyalty card. Those who buy Hudl on the Clubcard can buy it for less than £100 ($160) when the device goes on sale September 30, first in the UK market.
Tesco is playing on a magic combination of factors: it already has a pretty large range of digital services (from entertainment through to shopping and banking); we still have relatively low tablet penetration in markets like the UK; and it’s being very Tesco-like (that is, competitive) on price. It’s also just chapter one for Tesco in this game, says its CEO (emphasis mine):
“Hudl is a colourful, accessible tablet for the whole family to enjoy. The first stage in our tablet offering, it’s convenient, integrated and easy to use with no compromise on spec,” Tesco Chief Executive, Philip Clarke, said in a statement. “Customers are quite rightly very discerning about the technology they buy so we knew we had to be competitive on all fronts.”
In some ways, offering a tablet is a logical progression for Tesco, which has in the past year acquired Mobcast, an online bookseller, for $7.2 million; and beefed up its Blinkbox film and TV service. Alongside this, the company has its web portal for online shopping and grocery delivery, as well as various consumer-focused financial services like online banking and insurance, and brodband, telephone and cellular services.
As with Amazon and its e-commerce operation and content holdings and subsequent foray into hardware with the Kindle e-readers and subsequent Kindle Fire tablets, Tesco pulling all of these together and putting them front and center will help the company promote these products more effectively, in a way that only Tesco would be able to do on its own device.
Right now, the intention appears to be to offer these devices in the UK market only, which is Tesco’s biggest, with nearly half of its 6,784 stores; over 310,000 of its 530,000 employees; and most of its profit. Indeed, Tesco points out that in the UK right now some 75% of households do not own a tablet; and the market for these is still in its early days, even in developed markets, and it is there for the grabbing.
But I suspect the sights are bigger. Just as Tesco has plans to take its various online services out to other markets (those include China, India, Malaysia, South Korea, Thailand, Czech Republic, Hungary, Republic of Ireland, Poland, Slovakia and Turkey), it would make sense to bring Hudl along for that ride.
“Currently there is nothing specifically planned outside the UK, but that’s not always going to be the case,” a person close to the company told TechCrunch on the occasion of its Blinkbox digital content launch earlier this year, when the company also made a big point of hinting hard about a tablet launch.
Today, a spokesperson echoed that sentiment. “We wouldn’t rule out other markets in the future,” he said, in response to questions about what will come after the UK.
Going global is also what the company did with other digital pushes, claiming that it “built the world’s first virtual store where commuters buy groceries via their mobile phones in South Korea.” (Those services first came online in its home market, the UK.)
In fact, you could argue that, with the economies of scale that you need to make hardware break-even or profitable business, pushing the tablet into international markets will be an important part of the equation for Tesco, which says that it is producing the tablet with a “manufacturing partner based in China…which also manufactures well-known products for Microsoft, HP, Blackberry and Sony.”
And while it makes sense for Tesco to push hardware to “close the loop” on the digital proposition, it is also an imperative for the company in a wider sense. Philip Clarke, Tesco’s chief executive, remarked recently on how conditions outside the UK remain “challenging” with the UK currently “subdued.” Pushing into new areas like hardware and tablets in that regard is an important offensive move to defend against erosion and competitive pressure elsewhere in the business.
· 7” 1440 x 900 HD screen
· Android Jellybean 4.2.2
· 16GB storage which can be expanded to 48GB with microSD cards.
· Quad-core 1.5GHZ processor
· 9 hours video battery life (Conditions may vary dependent on video format and content, audio volume, screen brightness and processor load)
· Micro-HDMI port
· Bluetooth 4.0, GPS
· Dual band Wi-Fi for a more stable connection
· Access to over a million apps via Google Play™
· Comes in 4 colours: black, blue, red, purple
· Wi-Fi only
· Sleek, high-quality design, with a durable, matte, soft-touch back for better grip
· Scratch resistant touch screen