CHARLES DUNSTONE and Carphone Warehouse have a new challenger for the top spot of Britain’s booming billion-pound mobile-phone market — Phones4u’s Tim Whiting.

Whiting became boss of Dunstone’s main retailing rival when John Caudwell sold his group for £1.5 billion in a long drawn-out deal that was completed at the end of last month.

Caudwell’s decision to sell up and sail into the sunset caused the business he founded to be split. The retail operations, headed by Whiting, have been bought by Providence Equity Partners while another private-equity firm, Doughty Hanson, acquired 20:20, the logistics and distribution business.

Caudwell, a billionaire who used to cycle to work, never quite managed to overtake Carphone Warehouse as the country’s No 1 mobile-phone retailer. But Whiting, who prefers the less strenuous pastime of golf, is pedalling hard to catch Carphone.

“The latest market-share numbers give us 20% of new-contract business in the UK,” said Whiting. “That’s a very similar number to Carphone Warehouse. Our market share has been steadily growing.”

Britain’s love affair with the mobile phone shows no sign of coming to an end, but the high- street retail market is in a state of turmoil.

The Link, the poorly performing handset retailer created by Dixons, was recently sold to O2, the network operator that already held a 40% stake. This is only one of a number of moves by the mobile carriers to strengthen their control over their distribution outlets; 3 is also opening more shops of its own.

Relying too heavily on independent retailers can be costly for the mobile-phone companies. The cost of “churning” — customers who switch between networks — is one of the industry’s biggest headaches. Yet this churn generates a lot of commission for the retailers.

Caudwell has said that the great days of the mobile-phone business have gone. But Whiting said it was “absolutely not” the case that Caudwell had sold up “because there’s no money in it”.

He said: “Our sales are about 25% up year on year. The business has performed exceptionally well over the past couple of years. We have some exciting plans to continue that.”

These include more store openings to increase the number of outlets to more than 450. A move into continental Europe is also under consideration, with Spain a likely first beachhead.

Whiting, who has been running Phones4u since 2004, said the recent growth in the business stemmed from its relentless focus on customers aged between 16 and 35.

“Our brand is targeted at that youth market,” he said. “Clearly, the mobile is key to those customers’ lifestyle. They demand the latest handsets, they’re driven by technology, they’re the highest users of mobile content.”

One example is that more than 30% of Phones4u customers are buying 3G phones, capable of downloading music and video over the internet. The demand for these and other services, beyond voice calls and texting, are crucial for the future of the network operators.

Whiting said that Phones 4u’s strong position in the youth market would give it a better chance of reaching an accommodation with the mobile companies as they seek to re-assert control over “their” customers.

“What’s very important is that we are complementary to our network partners,” said Whiting. “We can add real value, not just to the customer, but to our network partners as well. Their own stores will target different segments of the customer base.”

Whiting, who spent more than six years working for Caudwell Group, comes across as a no-nonsense character. The Providence-backed deal could make millions for him and his management team but he describes the way the deal came about in matter-of-fact terms.

“All I was looking for was the opportunity to continue to drive our piece of the business forward,” he said. “There will not be a huge amount of change.”

Phones4u’s focus under Whiting extends to its product lines. Unlike Carphone Warehouse, Phones4u has not been tempted to selling iPods and Sony Playstations.

And while Dunstone is investing heavily to make Carphone’s Talk Talk arm a leading broadband and telephony supplier, Phones4u abandoned its own foray into fixed-line telecoms this year when it sold its Homecall arm to Pipex Communications after running up heavy losses.

“It was a strategic decision not to stay in the fixed-line broadband market,” said Whiting. “What we sell in our retail stores will be decided by what our customers want.”