The just completed $4.25 billion auction of wireless spectrum has changed the industry "forever" in Canada by ushering in a new era of increased competition that will mean lower prices for consumers, says Industry Minister Jim Prentice.

But the government has yet to decide how to spend its unexpected bounty, Prentice said Tuesday, although Liberal critic Scott Brison has already called on Ottawa to devote at least half the amount to bring high-speed Internet to rural areas, small towns and the North.

Speaking in Edmonton for the first time since the auction's conclusion on Monday, Prentice conceded that the amount of money paid by 15 high bidders - including a handful of new players - far outstripped the government's top expectations of about $1.5 billion.

Prentice said it may take about a year for Canadians to begin benefiting from the transformation that will occur once new entrants begin setting up operations, but that the impact will be massive.

"Competition is extremely important," he said. "When competition flourishes, consumers will benefit because we will see more choice, lower costs and better services.

"This has changed the wireless industry in our country forever," said Prentice.

Not all are so confident that the auction will transform the industry, however. Analyst Troy Crandall of Montreal's MacDougall, MacDougall & MacTier noted that a previous auction allowed the entry of Clearnet and Microcell into the cellphone, but both were later gobbled up by the incumbents.

And he noted that at the time, cellphone penetration was only about half of what it is now, meaning today's new entrants face an even more crowded space.

An immediate beneficiary of the auction is the federal treasury, which will be $4.25 billion richer when payment from bidders comes due in 30 days.

Prentice said the government has not yet decided what it will do with the windfall. He cited debt repayment and tax relief among other possible and undefined options.

But Brison said the government would be making a grave mistake if it did not take advantage of its good fortunate by making sure high-speed Internet is expanded to all areas of the country.

At present, 20 per cent of Canadian communities are not hooked up to high-speed Internet, he said, adding that telecommunications officials have told him it would take about $2 billion to connect all Canadians.

"It is very difficult to build a business in rural and small towns without high-speed Internet," Brison said. "High-speed Internet connectivity is as important to Canadian communities today as rail lines were 100 years ago."

Telus Corp. (TSX:T), which spent $880 million on 59 licences, has also called on Prentice to earmark a portion of the proceeds for expanding wireless services to remote areas.

Prentice responded Tuesday that it is but one priority among others that the government will consider.

While some analysts have speculated that the high price paid by providers for the 282 licences will cause the industry to pass on those costs to consumers, at least in the short term, Prentice said he believed the opposite would happen.

And he said rules in the auction will dissuade successful bidders from selling licences, or from "hoarding" broadband rather than putting it into use.

"Spectrum is an extremely valuable resource," said Prentice.

"The people who have bid to acquire it are very sophisticated market participants and I expect they will put it to market use."

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