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6 May 2014 Last updated at 06:39
The smartphone will come with built-in Tesco services Tesco is to launch its first own-brand smartphone by the end of the year.The BBC understands the phone will run Google's Android software, and the specification will be comparable to the Samsung Galaxy S5,
Chief executive Philip Clarke told BBC Radio 5 live's Wake Up to Money programme the device would be pre-installed with Tesco services.
The smartphone plans follow the launch of a Tesco's tablet, the Hudl - which has sold half a million units so far.
A refreshed version of the Hudl tablet - the Hudl 2 - will be released in September, Mr Clarke said.
The Hudl tablet entered the the lower end of the market, priced at £119 and competing with devices that had relatively low specifications.
However, the smartphone is expected to be comparable to the higher-end of the market - but aggressively priced.
'New Tesco'Mr Clarke also gave a broad hint that he intended to stay on as Tesco's chief executive until 2020.
He said: "I'm 54 and I have been at it for 40 years.
"I think normally in Britain people like me retire at 60 and that gives me another six years."
He said his role attracted "incredible scrutiny" and joked that he was "never short of people telling me how to do my job".
Tesco's Hudl tablet will be upgraded in September But he denied suggestions that his style, since taking over as chief executive, had been responsible for a succession of senior departures from Tesco, with finance director Laurie McIlwee the latest to announce that he's leaving.
"Look at any team and how it evolves," said Mr Clarke.
"When you get a leadership change it's inevitable that people will want to think about what that means for themselves.
"But I have a very strong management team - some have been here 20 or 30 years and some have come in the last two or three."
Mr Clarke also coined a new phrase - "New Tesco" - to sum up his effort to change the company's focus away from huge stores and on to smaller shops that are more focused on the particular needs of a local community.
He said Tesco would open 12 big stores in the coming year, but no more of the huge Tesco Extras.
"It is," he said, "the end of new big stores."