Fun fact time: 
- 2 billion dollars could buy 2.5 million miles of cat5 cable. That is about 8 times to the moon and back. Or 100 times around the planet earth.
- 2.5 million miles of cat5 cable would weigh 140000 tons. That is a quarter of what the world trade center weighed.
- In China such an epic failure would surely mean the death penalty for everyone involved.

I personally think this money would have been better spent BUILDING A FEW NEW WORLD TRADE CENTERS.

This is typical how our pathetic government waists taxpayer dollars. First off what's wrong with phones? Not a damn thing but they have to waste billions on some so called state of the art crap. Then they wonder why everyone hates the government except for the hacks that are in the government sucking on the tit of the taxpayers.

Sure hope they didn't give any large amounts of money to the company doing the work yet. Would be typical though, probably already paid them a couple million, and I'm sure they get to keep it when they get the boot.

How can the state lose out on these deals if they only pay if the project is a success?

Simple, only pay if it works, don't if it doesn't. To go further, have regular dates for completion of goals with payments made based on achieving these goals. If the dates are missed, there is a penalty. If the project slips too much, there is a penalty and the work is put out for tender again.

Long term projects need proper managing, if the city are saying it's slipping then I don't think the city have the right management team in place. I would be looking at firing the management team and having a monetary penalty against the contractor.

Speaking as someone who has never managed a poject as large and difficult and politically spiked as this one, it's just my tuppence worth, literally.

Tyco Electronics' web server runs Microsoft Windows software. Visitors of that web site who have not installed Adobe Macromedia Flash software get the advice to do so. I would not pick Tyco Electronics for a 2 billion dollar project.