A new auction of wireless spectrum is expected by 2012, Industry Minister Tony Clement said Monday.

Speaking at the International Institute of Communications conference in Ottawa, Clement said the government will launch consultations "shortly" on the possibility of selling 700 MHz wireless spectrum, with a view to auctioning it off by late 2012.

Tony Clement says the government will soon launch consultations on the 700 MHz spectrum, with a view to auctioning this spectrum by late 2012.

The 700 MHz spectrum is currently being used by television broadcasters, but will become available for wireless telecommunications networks once broadcasters meet the government's deadline to switch from analog to digital by mid-2011.

And another round of consultations on the 2,500 MHz spectrum will begin in early 2011, Clement said.

Duncan Stewart of Deloitte Canada applauded the timing of the announcement, given that spectrum allocation takes years if it's to be done properly and because it can't be reversed.

"Just as it is with highways, the day you want to start planning for new highways … is long before the entire city is shut down with gridlock," he told CBC News.

Increasing use of mobile wireless for email, web browsing and especially video is already taking up more spectrum than is now available, and is causing dropouts and slow connections, he said.

"If you are currently not happy with your wireless connection, this is a big part of how that problem gets solved."

Foreign ownership rules could change

The industry minister also said that ongoing discussions into a possible changing of foreign ownership rules in the telecom sector would be integrated into the spectrum consultations.

"This just makes sense," he said. "After all, how spectrum is allocated and who is eligible to compete for it — and pay for it — are interrelated issues."

The last time the government auctioned off wireless spectrum, in 2008, Ottawa managed to raise more than $4 billion from existing carriers such as Rogers Communications Inc. and BCE Inc.

A set amount of spectrum in that auction was set aside for new entrants, which allowed companies such as Wind, Public Mobile and Mobilicity to set up shop.

In December 2009, Clement overturned a CRTC ruling that found Wind violated Canada's foreign ownership rules by being backed by Egyptian telecom giant Orascom.

Current rules prohibit any foreign entity from majority owning a Canadian telecommunications firm.

He set a deadline of spring 2011 for his department to outline the government's policies in both regards.

"By spring of next year, I will be in a position to assess how all these elements fit together and decide on the best way forward," he said.