Here's what I foresee actually happening: these networks will work great for 10 years or so. But eventually the maintenance costs will catch up, and you'll have service outages that take days to fix because it's run by lazy government workers with a guaranteed pension. Customers will complain, but nothing will happen until the city goes broke (as happens to nearly every city every decade or so). So the city auctions off the telecom infrastructure to private buyers for pennies on the dollar or spin it off as a new private entity. The net result is the same: the taxpayers will have subsidized the construction of yet another redundant telecommunications network owned by private money.
The reason I'm pretty sure that this is what will happen is because this is exactly what's happened to most of the municipally-owned utilities across the nation. Chances are that your gas company or electric company are privately owned (water/sewage tends to remain municipally owned because it's simply not profitable under any scenario that preserves basic sanitation). The city hits a budget crisis and starts looking for assets to sell, and utilities are huge capital assets that can bring in a lot of cash relatively quickly.