Natural monopolies benefit from scale. For water you need treatment and then sewage. Unless you can pump ground water there and then, you facilities are cheaper per unit when they scale up at least to certain point.

So for same continuous geographical area having single water utility is lot of sense.

Same mostly goes for power.

With internet, the actual infra is so small and affordable that only the last bit to consumer is expensive per unit. So in sanely operated markets you can have multiple operators at same time and competition works.