UPDATE 2-Canada plans another wireless spectrum auction

(Recasts, adds comments, details; changes placeline from Ottawa)

By Wojtek Dabrowski and Louise Egan

TORONTO/OTTAWA, July 22 (Reuters) - The Canadian government plans to sell off more wireless spectrum in the next year and a half, following a heated auction of airwaves that raised C$4.25 billion ($4.21 billion) and could soon reshape the country's mobile phone market.

"There is what I refer to as the 700-series bandwidth," Industry Minister Jim Prentice told reporters. "There is an auction of that which will happen at some point in the future ... as I recall, it's about 18 months away."

The 700 megahertz airwaves are considered valuable because they can cover long distances and more easily penetrate obstacles such as thick walls and buildings.

Such an auction could further shake up Canada's wireless landscape by opening up more spectrum to firms other than the Big Three providers -- BCE (BCE.TO: Quote, Profile, Research, Stock Buzz), Telus Corp (T.TO: Quote, Profile, Research, Stock Buzz) and Rogers Communications (RCIb.TO: Quote, Profile, Research, Stock Buzz) -- who currently rule the market.

In the United States, major wireless carriers spent billions earlier this year on securing 700 megahertz licenses. Verizon and AT&T (T.N: Quote, Profile, Research, Stock Buzz) won more than $16 billion of the licenses, according to auction results.

"They scored big time in terms of government revenues," Amit Kaminer, an analyst at telecom consulting firm SeaBoard Group, said of the U.S. auction. He added the 700 megahertz spectrum was formerly used for television broadcasting.

Prentice characterized the 700-series spectrum is "highly prized." The auction that concluded on Monday was a sale of spectrum in the 2 gigahertz range.