Red Herring reports that New Orleans' CIO won't turn off the city's Wi-Fi network: The network was put up under emergency provisions that allowed the city to bypass a state-wide law prohibiting city service of 144 Kbps or greater (this is widely misstated as 128 Kbps; read the law). The city had surveillance cameras and public safety services linked via mesh networking gear before Hurricane Katrina hit, but companies like Tropos and Intel donated piles of new gear to set up a core area and planned citywide network.
Bellsouth and other incumbents are fighting hard. Bellsouth misstepped in December by getting angry about New Orleans's network and then trying to pretend they hadn't. I don't know Louisiana politics, but I have to wonder if ACT736 (the enacted form of Senate Bill 877) could face repeal of provisions that prohibit this form of network. (Here's a link to the law.)