Nortel's technology is being used by the Taipei City government in Taipei, Taiwan -- the largest municipal wireless network in the world, according to the company. Nortel has also developed a strong market with smaller cities, Whiteford said, and is offering starter kits in access point bundles of five and 10. Nortel last month also opened a laboratory in Research Triangle Park, N.C. dedicated to research and development of broadband wireless products specifically focused on municipalities.

One recent Nortel customer, the city of Carlsbad, N.M., has only 10 access points in its downtown area, offering private citizens and businesses wireless Internet access for free, said Robert Detweiler, immediate past executive director of the Carlsbad Department of Development, a non-profit development authority for the city and county of Carlsbad.

"Our main purpose in building the network was to offer another service to put us on a competitive playing field with other communities," Detweiler said. The city only has 26,000 residents, but after the network was set up in the summer, it became a popular way to connect to the Internet from Carlsbad's outdoor amenities, including a park and beach area.

"The other day, parents were able to watch their kids play tennis and work on their laptops at the same time," he said.

The US$10,000 network covers enough area to be able to serve the town library, the commercial district and a conference center, he said. Nortel was an obvious choice because it had been the vendor on other network projects, he said. The service is free for now, but after a year in use, city officials are likely to evaluate costs and whether users may eventually have to pay for access, he said.