Tesco have been hiring a lot of Silverlight and similar discipline developers. They have been working on their own TV streaming service like Netflix, but this one is free. It is supported by advertisements.
For those not from the UK Tesco has a very popular loyalty card system called ClubCard. They where pioneers of it in the UK market IIRC. They know what a lot of people shop for, when they shop for it, and often can guess very accurately what will be a conversion to a sale, and what won't. They do this at the moment with vouchers.
But now they have the streaming TV. They can charge (or they hope!) more for an advert than a competitor. It doesn't matter that Google knows you searched for xxxx or that in an email your friend mentioned that you liked yyyy. Tesco know what you actually bought.
They can measure the effect of showing the same person 10 impressions, and if it results in a conversion. Google and their ilk can not say if it worked. Did more people buy your nice brand of soup because of that slick new advert? Or was it just because the weather was a bit gray that week? Tesco will be able to tie up those exposed to adverts and those who then convert.
They can get a beachhead in your digital life, when for many they already control most of their physical.
This isn't just about selling a tablet, it is about moving advertising in a way we've never seen before in the digital world.
I am very impressed by them for doing this. Rather than re-act to the digital world by using their physical world tactics, or buy just buying some trendy startup. They've taken the best bits of both creating a platform to allow them to fully exploit it.
However, I absolutely hate targeted advertisements, so they won't be getting me near their damned ecosystem (or ClubCard!)