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Tesco to Sell iPhone in U.K.

http://online.wsj.com

LONDON -- Tesco PLC said Thursday it will sell Apple Inc.'s iPhone in the U.K., potentially bringing its lower-priced ethos to the smartphone market.

The British retailer didn't confirm a start date or tariffs for the iPhone but said in a brief press release that both the original iPhone 3G and the new iPhone 3GS would be available shortly.

After a two-year exclusive deal with Telefonica SA's O2, Apple opened up its distribution channels in the U.K. earlier this month when France Telecom SA's Orange network began to sell the phone. Vodafone Group PLC is set to follow in the new year.

Tesco Mobile is a joint venture between Tesco and O2, and derives the majority of its sales from low-margin, low-priced pay-as-you-go phones operating on the O2 network.

While the company does sell a small proportion of longer-term mobile contracts, a lack of in-store sales staff dedicated to signing up new customers has limited the sale of these more lucrative contracts.

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