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Telecommunications Systems: An Introductory Guide
Steven Glass, Partner
February 1997

Fixed Telecommunications Networks

Telecommunications Networks

A telecommunications network permits the transmission of sound, video, computer data or other information between the telephone or other terminal device (such as a computer or facsimile machine) of one party and the telephone or other terminal device of another party by establishing a connection between the telephones or terminal devices of the parties. A telecommunications network comprises the following elements:

  1. transmission systems;
  2. switching systems; and
  3. signalling systems.

Transmission Systems

A transmission system is a means by which information passes from one point to another. It comprises both the transmission medium and transmission interface equipment.

A transmission medium is the medium on which the information is conveyed. The principal kinds of transmission medium are:

  1. Copper Wire: Information can be conveyed on pairs of copper wires in the form of electrical current. The transmission medium to which most residential telephones are connected is copper wire.
  2. Co-axial Cable: This is a cable on which information is conveyed in the form of electrical current passing through a metal core surrounded by a metal sheath. Co-axial cable has the capacity to carry more information at higher speeds and better quality than copper wire.
  3. Fibre Optic Cable: This is a cable made of a very thin strand of glass, through which information is conveyed by means of pulses of light. Fibre optic cables permit high quality transmissions at very high speeds. Several optic fibre strands may be contained within one cable.
  4. Radio Transmissions: These permit the transmission of information in the form of radio waves, without the need for a physical cable. The quality and capacity of radio transmissions depend upon many factors including the power of the radio transmitter and its antenna, and the radio frequency upon which the transmission is to occur. Radio transmissions may be by way of point-to-point links, such as between antennae or dishes located on towers or buildings, or between satellite dishes and a satellite, which is basically a large antenna in space.

Transmission interface equipment is used to convert one form of a transmission to another. For example, if part of a transmission is carried on copper wire, and another part is on fibre optic cable, interface equipment is needed to convert the electrical signal on the copper wire into light pulses for transmission on the fibre optic cable. Similarly, if a transmission is in analogue form, transmission interface equipment can be used to convert it to digital form.

Switching Systems

A switching system is a system which allows the temporary connection of the telephone or other terminal device of the calling party with the telephone or other terminal device of any other party selected by the calling party. If there was no switching system it would be necessary for a party to establish a separate and permanent connection from the party's telephone to each other telephone to which the party wanted to make, or from which the party wanted to receive, telephone calls. This would have the following consequences:

  1. There would be many physical connections to each telephone.
  2. A separate dedicated cable, or other transmission medium, would need to be laid between each pair of telephones between which a connection is desired. If a telephone user needed to make calls to, or receive calls from, several hundred or several thousand other telephones, there would be many hundreds or many thousands of cables which would have to be laid in respect of that user's telephone alone.
  3. A telephone call could not be made to, or received from, any telephone to which a telephone was not directly connected by a dedicated cable or other transmission medium.

In the experimental days of the telephone, the two telephone handsets were connected by a dedicated cable (called a "tieline"). When telephone networks were initially deployed, different telephone lines were connected within the network for the purposes of a call by a human operator who literally plugged one line into a socket connecting another line, thus creating for the duration of the call a single dedicated line between the calling party and the called party. The telephone switch, which was first an electromagnetic device and is now basically a computer, replaces the human operator and electronically "plugs" one telephone line to another for the purposes of each call. This ability to switch in a way which allows every telephone to be connected to every other telephone is one of the most fundamental features of a telephone network. Figure 1 below depicts a telecommunications system without switching, in which each telephone is directly connected to each other telephone: that is, each telephone needs five separate tielines to be connected to each of the other five telephones respectively. Figure 2 below depicts a telecommunications system with switching in which each telephone has just a single connection to the network. Switching allows for much more efficient network design because it, in effect, allows "virtual" tielines to be set up and then torn down for each individual call.

Figure 1

Telecommunications System Without Switching

Figure 2

Telecommunications System With Switching

The switching function is performed by an exchange. The term "exchange" is also interchangeable with switch. In a large public network there are many exchanges.

As noted, the first exchanges were manual switchboards operated by an operator. These switchboards had small holes or jacks. There was one jack for each party. A light by the jack or an audio signal would indicate to the operator that a party wanted to make a telephone call. The operator would then insert a cord into the jack. This established a connection between the operator and the calling party and allowed the operator to talk to the calling party. After establishing to whom the calling party wished to talk, the operator would plug one end of a cord into the jack of the calling party, and the other end of the cord into the jack for the party called, thereby establishing a connection between the calling party and the called party. When the telephone conversation was completed, the operator would disconnect the parties by pulling out the cords. This process of establishing a connection between the calling party and the called party, as and when required for a particular telephone call, and then disconnecting the parties when the call is complete, is known as "switching".

Technological development has led to the introduction of automatic exchanges which enable switching to occur without operator intervention. Their introduction involved the placement of dials on telephones, the allocation of telephone numbers and a requirement for the calling party to know the telephone number of the party called. By dialling a number, a person making a call informs the automatic exchange of the telephone to which he or she wishes to be connected. The switching function necessary to establish a connection between the two telephones is performed automatically by either mechanical or electronic devices in the exchange. Early automatic exchanges used "step-by-step" switching in which each digit dialled caused mechanical switches within the exchange to perform one further step of the switching process with the last digit dialled causing the last switching step to be performed, thereby establishing the connection to the party called.

Step-by-step switching has gradually been replaced by more modern and efficient forms of switching. Most modern exchanges now utilise common control switching in which a computer controls all of the switching operations of the exchange. With this method, a computer at the exchange collects the whole of the dialled number and then works out the switching, or series of connections, that is necessary to connect the calling party to the called party. The computer which performs this task can be programmed to take into account factors such as the level of congestion in parts of the network, when it determines the best sequence of connections to connect the calling party to the called party.

Signalling Systems

Within a telecommunications network having automatic exchanges, a signalling system is the means by which telephones inform telephone exchanges, and telephone exchanges inform each other, of the important features of each telephone call. Telephone exchanges act upon this signalling information for a number of purposes, including to ensure that each telephone call is routed correctly to the called party. The use of signalling is illustrated by the following simple example. When a telephone user dials a number, this causes the telephone to send a signal to the local exchange that that number has been dialled. On older style telephones, the signal is passed to the exchange by transmitting a series of electrical pulses along the copper wire from the telephone to the exchange. The number of pulses transmitted represents the digit dialled. On newer telephones the signal is passed to the exchange by a series of audio tones. Each digit dialled causes a tone of a particular pitch to be transmitted to the exchange. By either counting the number of pulses received, or detecting the pitch of the tones received, the exchange determines the telephone number of the telephone to which the calling party wishes to be connected. The exchange can then determine an appropriate connection which will ultimately achieve a connection to that telephone.

In a large, modern telephone network, signalling systems between exchanges can be quite complex. The following information is often conveyed in such signalling systems:

  1. the telephone number of the called party;
  2. the nature of the call (for example, whether the call is a standard call, an operator assisted call, a conference call, a free call, and so on); and
  3. the telephone number of the calling party. This information is known as Calling Line Identification ("CLI").

In the "Customer Access Network" portion of the network (see paragraph 29), where signalling systems are relatively simple, the signalling information between the telephone and the local exchange travel along the same transmission medium as the voice communications. This occurs, for example, when a telephone sends signalling information to the local exchange to inform the exchange of the dialled number.

In the "Trunk" ("long distance") portion of the network where signalling systems are complex, signalling information may be carried on separate transmission paths from the path carrying the voice transmission. One transmission path is usually able to carry the signalling information which relates to several thousand voice paths. Thus, for any one exchange it may only be necessary to have one or two signalling paths to carry the signalling information for all of the voice transmissions passing through the exchange. The system of combining signals for many voice paths into a separate signalling path is called common channel signalling.

Public Switched Telephone Network

The most commonly used telecommunications network is known as the Public Switched Telephone Network ("PSTN"). A PSTN is a network to which public customers are connected. It operates by switching calls rather than by permanent connections and it is designed to carry telephone (or voice) traffic. Most (non-mobile) telephones are directly connected to a PSTN. Figure 3 below shows the way in which a typical PSTN is structured.

Figure 3

Typical Public Switched Telephone Network (PSTN)

The portion of the PSTN which comprises the transmission system between the telephone and the exchange to which the customer is connected is known as the Customer Access Network ("CAN"). The exchange to which the customer is connected is known as the local exchange or the "terminal exchange".

The most common transmission medium within the CAN is copper wire. The copper wire is usually run in pairs from the local exchange to each customer. Bundles of wires containing multiple pairs are usually run from the local exchange to a series of distribution cabinets close to customers' premises. A single wire-pair then runs from the distribution cabinet to each customer.

Transmission occurs when electrical current is passed through the copper wires. In the case of transmission of speech, the current in the wires is varied in direct response to the speech of the person talking into the telephone. A telephone is connected to the end of the copper wire pair inside the customer's premises. A telephone handset is a device which can convert sound into electrical current, and electrical current back into sound.

The local exchange performs the first part of the switching function. If the called party is connected to the same local exchange as the calling party, the local exchange completes the switching function by simply making the connection between the two parties. If, on the other hand, the called party is connected to a different local exchange, then the local exchange of the calling party connects the calling party either to the local exchange of the called party or to some other exchange from which further connections can be made which will ultimately establish a connection between the calling party and the called party.

Long Distance/Trunk Network

The transmission, switching and signalling systems within the PSTN which enable calls to be routed from one local exchange to another outside the charging (local call) area of the first exchange are sometimes referred to as the Long Distance Network or the Trunk Network.

A long distance call will begin at one local exchange and end at another local exchange but in so doing may transit several other exchanges, sometimes known as trunk exchanges. In general, the greater the distance between the calling party and the party called, the more exchanges a call is likely to be switched through. If the call is to an overseas destination, it will be routed to an exchange known as an "international gateway" exchange. An international gateway exchange switches calls to various transmission mediums to other countries. If the call is to a mobile telephone, it will be routed to a special mobile exchange.

In the trunk network the transmission mediums commonly used are copper wire, coaxial cable, microwave radio and fibre optic cable. Whereas in the CAN, each copper wire pair carries an individual telephone service, the transmission medium between one trunk exchange and another normally carries many telephone conversations simultaneously. This is achieved by a process called multiplexing which enables a wire, radio signal or cable to be shared by many individual transmissions.

In order to explain multiplexing in more detail, it is necessary first to explain the difference between analogue and digital transmissions.

Analogue Transmissions and Analogue Multiplexing

The term analogue is used to describe the wave-form nature of voices and other sounds. The term is intended to express the concept that voices and other sounds are infinitely variable. For example, sounds may vary in their loudness and softness. They may also vary in their pitch. Until recently, telecommunications systems were invariably analogue. This means that the analogue voice wave-form of a person having a conversation on a telephone is converted by the telephone of the calling party into an analogue electrical signal with almost exactly the same wave-form. The electrical signal has the same characteristics, in electrical form, as the voice had in the form of sound waves. The telephone of the party called converts this electrical signal back into sound through a speaker in the telephone handset.

The pitch, or frequency, of a wave-form is measured in Hertz, or cycles per second. The frequency of voices and most audible sounds is normally in the range of 20 to 20,000 Hertz, although sufficient clarity of the sound can be achieved by transmitting only those parts of the sound which are in the range of 300 to 3,400 Hertz. Therefore, the transmission system within a PSTN is typically designed to carry an analogue electrical signal which has a frequency in the range of approximately 300 to 3,400 Hertz. The frequency range of a transmission medium is known as the bandwidth of the medium.

It is possible to design cables and other transmission mediums which can carry electrical signals in a much broader bandwidth, or frequency range, than is required for voice transmission. Co-axial cables, for instance, can carry electrical signals with frequencies of up to millions of Hertz. In analogue transmission systems, multiplexing can be achieved by a process known as frequency division multiplexing whereby information is transmitted simultaneously within different, and unique, frequency ranges over the same transmission medium. Many voice channels are multiplexed into a single physical medium by first converting each voice signal to a different, and unique, frequency range which lies within the bandwidth of the cable or other transmission medium. Then, all of these channels, on different frequencies, are transmitted simultaneously along the cable. At the receiving end, each channel's frequency range is separated using a filter, and then converted back to the frequency range 300 to 3,400 Hertz. The wider the bandwidth of the transmission medium the more telephone channels can be multiplexed in this manner.

Digital Transmissions and Digital Multiplexing

Digital transmissions transmit sounds in the form of a stream of binary numbers, rather than as an electrical signal whose characteristics mirror the characteristics of the sound. The binary numbering system is a system which allows numbers to be represented by a string of the digits "0" and "1", instead of a string of the digits "0" through "9" which are used in the usual decimal numbering system. These binary numbers are transmitted as a series of electrical pulses along the transmission medium. If the transmission medium is fibre optic cable, the numbers are transmitted as a series of light pulses.

The conversion of an electrical wave-form representing the sound into a series of numbers is called quantisation. The conversion process occurs by periodically sampling the electrical wave for the purpose of generating the numbers which form part of the number stream representing the sound. Each number, or digit, in the stream of numbers is called a "bit". Satisfactory quantisation of sound can occur if the sound wave in the range of 300 to 3,400 Hertz is sampled at a rate which generates 64,000 bits each second, although sometimes lower rates are used. Any wire, fibre optic cable, radio system or other transmission medium which has the capacity of carrying 64,000 bits per second (equivalent to 64,000 electrical pulses or light pulses per second) will therefore be able to carry the digital transmission which represents the sound. The digital transmission can be reconstructed by the equipment at the receiving end into an electrical wave-form, and then into a sound which is the same as that which generated the stream of bits. A speed of 64,000 bits per second, or 64 kilobits per second, is often denoted as 64 kb/s.

The transmission of sound in digital form brings several significant advantages. They are:

  1. unlike an analogue signal which degrades in strength and quality with the length of the transmission path, it is possible to transmit a digital signal over any distance with extremely low degradation;
  2. digital multiplexing and demultiplexing is a more stable and adaptable process than analogue multiplexing. It suffers from less degradation and is easier to maintain than analogue multiplexing systems;
  3. it permits the use of techniques known as digital compression which effectively increase the capacity of a single transmission medium by a factor of 4 or more (these techniques are principally used for international transmissions);
  4. it more readily allows for transmission of computer data (because computer data is invariably in digital form) thereby enabling computers and other digital devices to communicate with each other across the network; and
  5. it permits the use of more sophisticated signalling systems.

In digital systems, multiplexing is achieved by a process known as time division multiplexing. This is possible because although a stream of bits representing a voice is transmitted at a rate of only 64,000 bits per second, many transmission mediums can carry bits at the rate of 2,048,000 per second or more. A rate of 2,048,000 bits per second, or 2 megabits per second, is often denoted as 2Mb/s. Speeds of 2,400 Mb/s can be achieved on modern fibre optic cable systems. A digital multiplexer therefore has a number of (low speed) input lines which are combined into a single (high speed) output line. It receives a group of bits from the first input line and transmits them at high speed on the output line, then receives a group of bits on the second input line and transmits them at high speed on the output line, and so on until it has received a group of bits from each input line sequentially and transmitted them on the high speed output line. It then returns to the first input line to receive the next group of bits. This operation occurs so quickly that no bits are lost from any input line. At the receiving end, a demultiplexer receives the first group of bits on the high speed line and transmits them at low speed on its first output line, then receives the next group of bits and transmits them at low speed on the next output line, and so on. Each output line therefore carries a stream of bits identical to the corresponding input line to the multiplexer at the transmitting end.

It is common to express the capacity of a digital transmission medium by the speed or rate at which it is able to transmit digital information. A single voice transmission normally operates at 64 kb/s. Over copper wire, thirty such transmissions can be typically multiplexed to a speed of 2,048 kb/s or 2Mb/s. This is an international standard and a transmission medium with this capacity is commonly known as an E1. Modern trunk exchanges are generally built to permit connection to transmission mediums which have that international standard rate. However, where optical fibre is used it is possible to achieve much higher speeds (typically up to 2,400 Mb/s) and consequently much higher levels of multiplexing are required.

Common Control Switching

In modern exchanges, the function of recognising and acting upon signalling information so as to control the switching process and thereby to establish a transmission path between the calling party and the party called is provided by computers. As the operation of a computer is itself controlled by a software program and by data stored in the memory of the computer, these modern exchanges are generally known as Stored Program Control ("SPC") Exchanges. The use of computers allows changes in operation of the exchanges to be made easily by changing the software. This is useful, for example, where a customer moves from one place to another and wishes to retain the same telephone number. The computer can be reprogrammed so that when the number is dialled it establishes a connection to the customer's new telephone instead of the old one. No changes in wiring are required.

The provision of the control function by computers has also facilitated the physical separation of those parts of the exchange which control the switches from the physical switches themselves. The control function can be centralised so that a single computer can provide the common control for a number of switches which can be located in convenient positions remote from the computer. This enables switches to be located closer to customers' premises, thereby reducing the amount of cabling required in the CAN. The control and remote switching parts of an exchange can then be interconnected by high speed transmission links. This leads to fewer, but more powerful, exchanges. It is often practical to combine within a single exchange the common control functions for both local and trunk calls.

The control function as provided by computers typically allows for different routing plans for different types of calls. Re-programming of the computer can be performed whenever a carrier's traffic routing plan is changed. This form of reprogramming is known as network conditioning. In older exchanges, which do not have computer control, network conditioning is effected by physical wiring changes within the exchange, or other hardware modifications.

One example of network conditioning is making the changes necessary to route certain traffic to points of interconnection between two telecommunications networks which interconnect. This is known as interconnect conditioning. Another example is the implementation of a new routing plan for a special or "enhanced" service such as the 1800 service (which allows a subscriber to connect to another at the expense of the party called). Calls to 1800 must be directed through specific exchanges. The routing will therefore be different from that applying to normal traffic, and the exchanges must be programmed to recognise 1800 calls and to route them accordingly.

Making a Call on the PSTN

It is now possible to explain the processes involved in initiating a call on the PSTN between the calling party and the party called by reference to Figure 3.

To make a call through the network the telephone of the calling party sends a signal over the copper wire to the local exchange when the handset is lifted off the telephone. The local exchange responds by providing a dial tone to the telephone. The telephone then sends signalling information to the local exchange containing the dialled number, to identify the party called.

The local exchange recognises the dialled number and establishes a connection which, if the party called is connected to the same local exchange, will be to a copper wire directly from the local exchange to the called party, or, if to a more distant destination, will be through a trunk transmission medium to another local exchange, perhaps via one or more trunk exchanges. Sometimes there are several alternative possible routes, or series of connections, which can effect a connection between the calling party and the party called. The decision as to what route to select is determined by the software in the computer of the local exchange. In older exchanges, which are not computer controlled, route selection can be determined by electromechanical devices within the exchange.

For a distant call, the local exchange will pass detailed signalling information, including the number of the party called, to the next exchange. If the local exchange is of modern design it will also pass the CLI. There may be several routes available to the local exchange of the party called and if there is congestion on the first route attempted the exchange will attempt the other routes. The call may be passed through several exchanges before it reaches the local exchange closest to the party called. If the party called is engaged the response is passed by the signalling system back through the network to the calling party and will result in an "engaged" signal being heard in the calling party's handset.

Facsimile Transmissions

Facsimile transmissions permit a document to be converted by a facsimile machine into an electric signal, and the signal carried across telecommunications network to the recipient's facsimile machine. The recipient's facsimile machine uses the electric signal it receives to create a document which has the same appearance as the original document. Although the process of facsimile transmission is essentially a digital one, most facsimile machines convert the digital signal into analogue form so as to enable the facsimile machine to be connected directly to an analogue telephone line. The telephone lines entering most premises are (analogue) copper wires. The quality of a facsimile transmission can, however, be improved by connecting it directly to a digital transmission medium.

Data Transmission

Data transmissions permit computers and other devices to communicate with each other across the network. There are many useful applications for the transmission of data. One obvious example is the Automatic Teller Machines now operated by some banks. When a customer of the bank seeks to withdraw funds from his or her account through the automatic teller machine, the machine sends a message across a telecommunications network to the bank's central computer which keeps all of the records relating to its customers' accounts. The central computer checks whether the customer has sufficient funds in the account and then sends a message back to the automatic teller machine which informs the machine whether the withdrawal is permitted. Messages sent in this way are referred to as "data transmissions".

Other examples of data transmissions across telecommunications networks are:

  1. electronic mail, by which a person can send a message over a telecommunications network from his or her computer to a person using another computer connected to the network;
  2. remote access, by which a person can use a computer connected to a telecommunications network in one place to access information, computer programmes and other material stored on another computer connected to the network in another place; and
  3. internet access, by which a person can use a computer in one place to gain access to information (including text, pictures, sounds, videos and other material) from, and to send electronic mail to, any one of thousands of computers connected to the internet network around the world.

Computer data is invariably in digital form. It is therefore desirable, whenever possible, for computers to be connected to a digital transmission service rather than an analogue one, although the computer data can be converted to analogue form for transmission if necessary. Data is commonly transmitted:

  1. in analogue form over the PSTN network;
  2. in either analogue or digital form over a leased line, depending upon whether the service is analogue or digital;
  3. in digital form over the ISDN network;
  4. in digital form over a digital data network.

Many data networks are what are called packet switched networks. With packet switching, a stream of data being sent from one place to another is first broken up by a computer at the sender's end into small batches. Each batch of data is then placed within a "packet". A packet is a quantity of data of a pre-defined size and in a pre-defined format. Each packet normally contains the following information:

  1. information identifying the place to which the packet is being sent;
  2. information identifying where the packet is to be placed in sequence within the whole of the data stream of which the packet is a part;
  3. a batch of data from the data stream being transmitted; and
  4. codes which allow the receiving equipment to determine whether any errors have occurred in transmission.

Each packet is then sent separately across the network to the recipient. Each packet might be sent via different routes across the network, and may arrive at the recipient at different times and out of sequential order. The computer at the recipient's end then checks if there have been any errors in transmission, re-assembles the packets into their correct sequence, using the information at the beginning and end of each packet, and creates a stream of data identical to that sent by the sender to the recipient.

There are internationally accepted standards, or "protocols", for the transmission of packet switched data, the most common being X.25. These define, for example, the size and format of the packets and the speed of transmission. Obviously, both the sender and the recipient of packet switched data must adhere to the same protocol.

The advantage of packet switching is that it is not necessary to tie up a transmission link for the whole of the time during which data transmissions are required to take place. Between packets, when the transmission link would otherwise be idle, it can be used to transmit other packets between a different sender and recipient. Consequently, packet switching achieves an efficient rate of use of transmission mediums.

As an alternative to packet switching, some data networks now use a system called frame relay. This is very similar to packet switching. The data is broken into "frames" rather than packets. Frames contain less error checking codes and can support higher data rates than packets.

Leased Lines and Private Networks

Leased Line services are services in which a carrier leases to a customer some of its transmission capacity along a particular route in the carrier's network. The customer pays an annual fee for the lease of that capacity, and the telecommunications carrier reserves that capacity in its network for use by that customer. This is a useful service for large customers with offices spread widely geographically. For example, if a company has an office in Sydney and an office in Melbourne and makes a large number of telephone calls, facsimile transmissions or computer data transmissions between its two offices, it is likely to find that it is cheaper to lease dedicated transmission capacity from a carrier rather than to pay the carrier in the normal way, on a call by call basis, with each call charged by reference to the duration of the call. Leased line services may be either analogue or digital, depending on the customer's needs, and may be provided by a permanent, dedicated end-to-end circuit or by an assigned virtual circuit for a packet switched service.

Private Network Services. Particularly large customers may acquire a number of leased lines which link up all of their offices in several locations. They may also install switching equipment in their offices which operate as little telephone exchanges, switching telephone calls transmitted across the leased lines between the offices. In this way, a customer can effectively establish its own private network. Sometimes, a carrier which supplies the leased lines used to form such a private network will also supply network management services to the customer.

Private networks carry communications which otherwise would be carried over the public switched network operated by a carrier. Although the carrier continues to receive fixed charges for the leased capacity used in the private network, this is often much less than the per minute charges that the carrier would have received for each call if the calls had been carried over the PSTN instead of the private network. For this reason, there are often regulatory restrictions on private networks, including:

  • no shared use - only one company is allowed to use each private network for its own communications. Different companies cannot use the same private network, but must each individually establish their own private networks. This means that only the largest companies will be able to justify setting up their own private network;
  • limited interconnection with the PSTN - the public switched network, and in particular the long distance part of that network, could be bypassed if a private network was connected to the PSTN at both ends. This would allow any person connected to the PSTN to make a long distance call by dialling into the end of the private network closest to them, the call then would be carried over the private network to the other end and routed back into the PSTN to terminate with another person connected to the PSTN. This is called double-ended interconnection. Initial regulation of private networks usually prohibits any interconnection with the PSTN at either end, which makes the private network entirely self-contained, connecting only the premises of the corporate customer using the private network. However, over time, regulators usually allow single-ended interconnection. This means that only one end of the private network can be connected to the PSTN. Calls can be made from anyone connected to the PSTN into the private network and the call can be carried over the private network to one of the company's premises connected to the private network. However, the call cannot be routed back out into the PSTN. Conversely, a call can originate from a company's premises connected to the private network and be carried over the private network and then sent out into the PSTN. This allows some bypass of the long distance network, but it is relatively limited.


A significant advantage of communicating in a digital channel is that messages can be encrypted. Encryption of communications is particularly relevant in environments (such as the Internet or Satellite communications) where a message can be intercepted during transmission by a third party. Encryption algorithms are software which use a cipher or key to scramble the message so that although interception remains possible, the intercepted message is unintelligible to a person without the corresponding key.

Different algorithms are optimised for different purposes. The most well-known generalist encryption algorithm is RSA. JPEG is an encryption system used for images on the internet and MPEG is a system used for compressing movies.

Telex and Telegram Services

Telex and Telegram services are a method of communication involving transmission of text (that is, a sequence of letters and numbers) rather than voice or data. A special telex machine or similar device is needed to make or receive such transmissions. Usually, telex and telegram transmissions are sent on a totally distinct network and do not utilise network infrastructure in common with the PSTN. Telex and telegram services have generally fallen into disuse, having been replaced by other services such as facsimile and electronic mail.

Local Area Networks

Local Area Networks (LAN) are the networks connecting computers and allowing the transmission of data between different terminals. The development of LANs illustrates the trend in computer technology to decentralisation of computing capacity - replacing the early generation's approach to large mainframe computers with a network structure that connects different terminals sharing processing power.

Enhanced Telecommunications Services

Telecommunications carriers nowadays offer services more complex than simply establishing a connection between one telephone and another. These services often utilise the carrier's existing PSTN, but involve special ways of routing or billing telephone calls. The following are some examples of these kinds of services:

  1. Toll Free services. These are telephone calls to special telephone numbers where the recipient of the call, rather than the caller, gets billed for the long distance portion of the call.
  2. Call Forwarding. This enables a person to have all calls made to a particular telephone number routed to a different telephone. So, for example, it could be arranged that calls to a person's home telephone number are routed to the person's office telephone number.
  3. Voice Mail. This enables a caller to leave a recorded message when the called party's telephone is engaged or does not answer. By dialling a special code on the telephone, the called party can later play back all of his or her recorded messages.
  4. Store and Forward Facsimile. This is effectively the facsimile equivalent of Voicemail. If the recipient's facsimile machine is busy or disconnected, the facsimile message is stored by the carrier and forwarded to the recipient when the recipient's machine subsequently becomes available.
  5. Conference calling. This enables 3 or more, rather than just two, persons to participate in a single telephone call.
  6. Centrex. This allows telephones in one or more offices to be given similar features to those available through a PABX at the customer's premises. The telephones are connected through the CAN to a central exchange operated by the carrier which effectively functions as the customer's PABX. Features available include abbreviated dialling within a private numbering plan, call forwarding, call transfer, call holding and conference calls. This is a useful service for companies with more than one office where otherwise a PABX would have to be installed in one office with leased lines to other locations.
  7. Calling Card. Many telephone operators issue calling cards, which have an appearance similar to that of a credit card, and which allow a call to be made from any telephone in that country, and often other countries, with the charge for the call being charged to the calling card instead of the phone from which the call was made. This charge is then included in the customer's ordinary telephone bill for his or her telephone service.
  8. Call Back. In some countries, particularly the United States, carriers have programmed their telephone exchanges to provide an international telephone service to users in another country using what is called "call back". This operates in the following manner. If a caller in Australia wishes to make a call to, say, England, the user dials the number of the call-back operator in the United States and then hangs up. The call back operator's telephone exchange in the United States then automatically places a call from the United States back to the user. When the user receives the call, he or she then dials the desired number in England, and the call-back operator's exchange then places a call from the United Stated to that number in England. In this way, a connection is made from Australia to England by way of two outgoing calls, both of which are made from the United states, rather than by a single outgoing call made from Australia. New callback technologies actually allow the call to be "reversed" with the customer staying on the line. A switch in the customer's home country holds the customer's call while the switch makes and receives the callback from the overseas switch, and then the home country switch merges the two calls. The customer may not even be aware that callback technology is being used, and the only perceptible impact will be a little longer delay after the international number is dialled before the call is connected (called "post dial delay"). Callback is placing competitive pressures on international monopolies, sometimes with the active encouragement of the regulator, such as in Hong Kong. Callback is an example of emerging technologies which can undermine or render redundant regulatory and legal concepts, such as monopoly service reservations.
  9. Virtual Private Networks. As described above, large companies sometimes establish private telecommunications networks using a series of interconnected private lines leased from carriers. It is also possible to programme exchanges within a PSTN to provide a customer with a service that has the appearance and functionality of a private network, but which in fact uses the PSTN rather than private leased lines to provide the service. This facility is often referred to as a virtual private network, or VPN. A VPN integrates the voice communications facilities of a customer (or groups of customers) by providing a replacement for leased lines. It can link large and small PABXs, individual phones and mobile phones. Unlike Centrex, it does not provide all the features of a PABX but it can offer a private numbering plan with abbreviated dialling and more sophisticated access control. The carrier can manage the network and provide a simpler billing structure. Because they use switched capacity, VPNs pose an even greater threat to monopoly international service preservation than private networks which use a fixed amount of leased capacity. VPN services increasingly are little more than special pricing plans for switched international calls provided to large corporate customers. VPNs are offered on a world-wide basis by large carriers or carrier groups, such as the AT&T led world partners and the Deutsche Telecom/France Telecom and Print Consortium. VPNs provided on this basis also are a technology which poses a threat to national regulation which creates monopolies or limited carrier reservations for international services.

Value Added Services

A value added telecommunications service is an additional service delivered or accessed through the telecommunications system, which has involved the additional of significant value to the basic switching and transmission functions. The value added can be in the form of information processing, delay, or other intervention. Value added services are also called enhanced services. They include personalised answering services, recorded information services, electronic data bases, radio paging services, reservation systems, financial information systems, electronic funds transfer, security and alarm services, and voice and text messaging services.

Internet Services

Internet services are a particular form of data services by which information stored on many thousands of computers around the world can be accessed. The internet is a packet switched network using a particular protocol known as Transmission Control Protocol/Internet Protocol, or "TCP/IP".

The internet is a global network of computer networks that use a shared communications protocol. The internet today connects over 5 million computers, 100,000 networks, and 35 million users in over 200 countries to access a wide array of information held on computers connected to the internet.

The world wide web which can be accessed through the internet provides entry into "home pages" which have been made available to the internet by governments, corporations, universities, institutions, and single individuals. The internet is also used to send and receive electronic mail and to exchange computer files and data.

The internet is not owned or controlled by any single entity, and presents new and complex problems for legal regulation and control, raising concerns about copyright protection and about the need for censorship for obscene material.


The numbering system involves allocating individual telephone numbers to new customers or allowing phone number changes by existing customers. Numbering has been an issue of some dispute in competitive service markets. The numbering plan traditionally has been controlled by the monopoly domestic carrier. A former monopoly carrier facing competition could for example attempt to control the numbering system to provide customers of the competitor with numbers which are not as attractive for consumers - such as numbers that are harder to remember or contain more complicated dialling sequences. Numbering also raises competition concerns where consumers are required to obtain a new number to connect to the network of a new competitor, or where customers are required to dial additional digits to access the competitors network.

Accordingly, in most newly competitive environments, the regulatory regime provides for numbering to be controlled by the telecommunications regulator.

Customer Premises Equipment

Customer premises equipment is the terminal equipment used by residential and business consumers. It includes such items as the telephone handset, the fax machine, the answering machine, or the PABX (private automatic branch exchange) together with the cabling required to connect the terminal equipment to the network. Some telephone companies have enjoyed a monopoly on the supply of customer premises equipment. The introduction of competition in the telecommunications sector has in many markets involved a liberalisation of the customer premises equipment requirements which traditionally applied.


The Integrated Services Digital Network ("ISDN") provides digital capacity directly to a customer thereby permitting services such as voice (in digital form) and various types of data to be sent and received by the customer. ISDN is an internationally agreed standard for the provision of such services and special customer equipment, such as PABXs which have interfaces which comply with this standard, are required by the customer in order to be able to use the service. Data transmissions on the ISDN network are not packet switched. Rather, they are continuous streams of data.

Although parts of an ISDN network may be physically separate from other networks, such as the PSTN, it is more common for much of the network infrastructure to be shared. For example, while an ISDN network may have its own switches, new PSTN switches are generally provided with ISDN capability. The network would largely utilise the same trunk transmission mediums as are used in the PSTN and can connect to customers using the existing CAN if the distances are within certain limits.

Bandwidth and Broadband

Technically, bandwidth represents the range of frequencies (in Hz) which could pass over a transmission channel. This larger this range, the greater the amount of information that could be sent through this channel. Today, bandwidth is used more generally to express the rate at which information can travel through a communication channel (in Kilobytes/second or Kbs).

The term "broadband" refers to the capacity of a network, rather than to the particular material out of which the network is built. Broadband capacity could be delivered via ASDL (Asymmetrical Digital Subscriber Line), VDSL (Very High Speed Digital Subscriber Line), both of which use existing copper wires, or by optic fibre, or by a wireless transmission system such as satellite or MMDS (Multichannel Multipoint Distribution System).

Broadband networks have the capacity to deliver services including television, video telephony, video mail and video conferencing, along with high speed transmission of data, text and graphics.

Intelligent Networks

An intelligent network concentrates the service capacity of the system in the network itself rather than in the telephone handset or the local exchange. Services such as messaging services, electronic directories or database access could all be widely available through an intelligent network. The "intelligence" is spread through the network at interconnected nodes.

With intelligent networks, any person linked to the network can access the services provided, rather than the services being provided through and requiring linkage to, a central point such as an exchange.

Advanced Intelligent Networks (AIN) provide even greater capacity for the development of customizable telecommunications services. Such services include allowing a user to access data files from any point on the network, enabling the service to follow the subscriber to any point on the network, and offering personalised services that can be accessed from anywhere using a PIN number.

Television and Video Services

Video services permit the transmission of television signals across a telecommunications network. Television signals are able to be converted into a stream of digital data. This data can be transmitted across any digital transmission medium whose speed is sufficiently high. Because the quantity of data needed to represent a television signal is large, the speed of the transmission medium is required to be very high.

There are three well known examples where telecommunications networks are used to deliver television communications. The first is cable television, in which several dozen television channels may be delivered over a broadband telecommunications network to particular subscribers. The second example is where television stations distribute television program material from a central studio to multiple regional television broadcasting stations. The third is where satellite delivered services are beamed to home based satellite dishes.

A number of technologies are emerging in the area of television and video services. For television, the development of High Definition Television (HDTV) would provide viewers with both a wider picture, and much sharper definition of picture given the increased screen resolution.

Interactive television-based services are undergoing rapid commercial development. These include interactive shopping, entertainment and music services. Video On Demand (VOD) is an interactive service that will be offered by pay television operators providing service via cable. Utilising a high capacity fibre network and set-top equipment, subscribers will be able to select any film offered by the pay TV operator and have that film delivered to their outlet at a desired time, to be billed for the purchase with the regular account.

Cable Television

Cable television networks (CATV) are a medium through which future interactive broadband services will be provided. The advantages of CATVs are that they are inherently more secure and robust than wireless transmissions, a high degree of interactivity is possible and they have a very high bandwidth. The major disadvantages of CATVs are that the network is slow to build, expensive and that subscribers are not mobile. Networks are expensive and subscribers are not mobile.

CATV networks can be deployed using either coaxial, fibre, or hybrid cabling. The following table summarises the differences between these options:





Very High

Susceptibility to interference


Interactivity possible?


Maintenance costs.




An alternative to installing a new CATV network is to use the existing twisted-copper network together with ADSL (Asymmetric Digital Subscriber Line) technology. This technology allows a telecommunications carrier which has an existing telephone network to transmit video services, by squeezing more data capacity through the copper wire. ADSL technology is expensive and incapable of delivering high quality video where a subscriber is more than 3 kilometres from the local exchange.

Compression Technology

One of the advantages of communicating using a digital channel is that compression algorithms can be used. A compression algorithm is simply software which eliminates redundancies in information and allows an otherwise large message to be transmitted using a smaller number of bytes. This technology is particularly useful for the transmission of video and audio messages through low-bandwidth channels (eg today's Internet).

Mobile Telecommunications Networks

Mobile Telecommunications

The telephone networks described above are often referred to as "fixed" telephone networks because the telephones are connected by a fixed wire to the telephone network. It is also possible to have mobile telephones which communicate with the network by transmitting radio signals, rather than by electrical current travelling along wires or light pulses on fibre optic cables. The user of a mobile telephone can travel from place to place, carrying the telephone with him or her, with the telephone at all times able to make calls to, or receive calls from, the network, provided that he or she is within the area covered by the mobile network.

The difficulty which exists in relation to mobile telephone systems, which does not exist with fixed telephone systems, is that each mobile telephone requires its own radio frequency for the transmission of a single telephone conversation. In fact, two such radio frequencies are required for each telephone conversation: one to carry transmissions from the mobile telephone to the network, and one to carry transmissions from the network to the mobile telephone. The problem is that there are only a limited number of radio frequencies available.

Wide Area Mobile Telecommunications Systems

Early mobile telephone systems worked by having powerful radio transmitters and receivers which broadcast and received radio signals for use by mobile telephones over a wide area. Each mobile telephone was tuned into its own specific radio frequency. Conversations with that mobile telephone user travelled between the radio transmitter and the mobile telephone on a radio signal with that frequency. This form of mobile telephone service suffers from the following deficiencies:

  1. because of the geographical characteristics of particular places, there were some areas where the signals received from the radio transmitter were weak or non-existent. It was therefore not possible to make or receive telephone calls if the mobile telephone user was situated in one of those areas;
  2. because the number of radio frequencies which were available for use by mobile telephone systems was limited, it was only possible to have a limited number of mobile telephone users.

Because of these deficiencies, this form of mobile telephone system, often referred to as a "wide area" mobile telephone system, is no longer used.

Cellular Mobile Telecommunications Networks

Mobile telephone networks now use what is called the cellular mobile telephone system. This uses a large number of low power radio transmitters and receivers, rather than a single high power transmitter. Each such low power radio transmitter and receiver is referred to as a base station.

The term "cellular" refers to the fact that the area in which the mobile system is intended to operate is divided up into a large number of small areas called "cells". There is normally one base station within each cell, although in some cellular systems each cell may be sub-divided into a number of sectors, with each sector having its own base station. When a mobile telephone is situated within a particular cell, it transmits radio signals to, or receives radio signals from, the base station in that cell. The power of the base station is low, so that the radio signals generated by it are weak. This has the result that the radio signals are not able to be picked up by mobile telephones which are more than a short distance outside the boundaries of the cell. The following diagram represents the structure of a typical cellular mobile system.

In order to minimise the possibility of mobile telephone users interfering with each others' telephone conversations, it is the normal practice that cells which reuse the same radio frequencies are not adjacent to each other.

It is possible to make the cells larger or smaller, depending upon the likely rate of use of mobile telephones within a particular area. For example, in country areas the cells are quite large. In busy metropolitan areas, the cells are normally very small, sometimes as small as one square kilometre. Should any particular cell become congested (that is, most of the radio frequencies available for use within that cell are being utilised most of the time), the cell can be subdivided into a series of smaller cells. New base stations must be built for each of the new cells. This has the effect that within the area of the old, larger, cell there are now many more radio frequencies available for use as a result of the introduction of a number of new, smaller, cells covering the same area. As a result, more users of mobile telephones may make telephone calls within that area simultaneously.

The process of subdividing cells in this way as congestion increases within a particular cell is often referred to as cell splitting.

The way in which a cellular mobile telephone system works means that a particular radio frequency cannot be allocated permanently to a particular telephone. Rather, a particular range of radio frequencies is allocated to a particular cell. When a mobile telephone user wishes to make a call, he or she turns on the mobile telephone and dials a number. The mobile telephone transmits a signal to the nearest base station telling the base station that the mobile telephone user wishes to make a call. The base station then identifies a radio frequency which is not in use at that time and transmits a signal to the mobile telephone to inform the mobile telephone of the frequency upon which that call is to be made. The mobile telephone then tunes into that radio frequency. The base station passes the dialled number to a telephone exchange which makes the connection, or series of connections, necessary to connect the mobile telephone from which the call is made to the called telephone.

An additional complication arises in cellular mobile telephone systems when the mobile telephone moves out of one cell and into the next during the course of a telephone conversation. The base station monitors the strength of the radio signal during the call. When the signal becomes low, as the caller moves out of the cell, the base station notifies the mobile exchange. The mobile exchange then sends a signal to the base station in the adjacent cell informing it that the mobile telephone is about to enter that cell. The new base station then allocates a new frequency for the call, and sends a signal to the mobile telephone that the telephone should henceforth use that new frequency for the call. The mobile telephone then tunes in to the new frequency, and the call continues, uninterrupted, through the new base station on the new frequency. The process of transferring a telephone conversation from a particular frequency in one cell to a new frequency in an adjacent cell is called a hand-off.

In cellular mobile systems which are quite busy, the situation can occasionally arise during a hand-off when there are no more available frequencies in the cell into which the mobile telephone is moving. When this happens, the call can be cut off midstream. This is called a drop-out. When there is a high rate of drop-outs in a particular area, the owner of the mobile network will normally split the cell for that area into a number of smaller cells, as described. A drop-out can also occur if the mobile telephone user moves into an area which:

  1. is not within any cell, and accordingly has no base station from which it can receive, and to which it can send, radio transmissions (this is sometimes described as moving outside the coverage area of the mobile telephone system);
  2. is within a cell in which the base station is faulty; or
  3. is shielded by the surrounding geography from receiving radio signals from the base station.

Given the highly complex way in which cellular mobile systems operate, very sophisticated signalling and switching systems are required. In addition to the information which is conveyed by signalling systems in the fixed network, the signalling systems in a mobile telephone network need to convey the following information:

  1. the identity of the cell in which a mobile phone is situated;
  2. the radio frequencies to be used for a particular telephone conversation;
  3. the movement of a mobile telephone from one cell to another.

In addition, the base stations need to send signals to the mobile exchange in order to effect the hand-off process.

A cellular mobile network has its own telephone exchanges. It is, however, important for these telephone exchanges to be connected to the fixed telephone network because most telephone calls made from a mobile telephone are to telephones on the fixed network, and similarly, most telephone calls made to a mobile telephone are made from the fixed network.

A mobile telephone network also has computer systems which contain databases of information necessary to control the network. For example, one such database keeps a record of the location of every mobile telephone in the network. The mobile exchanges provide information to, and retrieve information from these databases. A mobile exchange, together with its associated databases, not only switches calls between mobile telephones and between mobile telephones and the fixed network, but also controls the hand-off process between base stations.

Each base station is connected by a fixed transmission medium, such as fibre optic cable, to the mobile exchange. Sometimes, the transmission medium between the base station and the mobile exchange is a very high frequency form of radio transmission known as microwave. Because it is likely that at any one time there are numerous telephone calls being made within a particular cell, the link between each base station and the mobile exchange needs to have sufficient capacity to enable many calls to be carried simultaneously through the process of multiplexing.

In most cases, when the mobile telephone user makes a call to a fixed telephone, the mobile exchange will route the call to a PSTN exchange. The PSTN exchange will then continue the switching process in order to route the call to the telephone of the called party. If, however, the mobile exchange determines that the destination of a call is another mobile telephone on the same cellular mobile network, it will route the call to the appropriate base station for the called telephone.

Kinds of Cellular Mobile Systems

There are two kinds of cellular mobile telephone networks currently in use in different countries. They are:

  1. Advanced Mobile Phone System ("AMPS"); and
  2. Groupe Speciale Mobile, also known as Global System for Mobiles ("GSM").

In some countries, such as Australia, both are now in use, but the AMPS system is being phased out.

AMPS is a technical standard for cellular mobile telephone systems developed in the United States. It is an analogue system in the sense that voices and other sounds are transmitted by radio from the telephone to the nearest base station in analogue form.

GSM is a more recent technical standard for cellular mobile telephone systems which was developed in Europe. It is a digital system, because communications between the mobile telephone and the base station are in digital form. This means that each GSM handset must contain the electronics necessary to convert the analogue voice wave form into digital form. GSM has the following advantages over AMPS:

  1. more sophisticated signalling systems are able to be used;
  2. because it is a widely accepted international standard, GSM telephone handsets may be used in many countries around the world where GSM is the accepted standard, including most of Europe and parts of Asia;
  3. radio signals carrying digital information are more difficult to intercept than radio signals carrying analogue information. Therefore, while telephone conversations on the AMPS network are susceptible to unauthorised interception, it is extremely difficult to intercept telephone calls on the GSM system. GSM is therefore a more secure form of communication;
  4. because it is a digital system, GSM is more suited to the transmission of computer data, which is normally in digital form; and
  5. GSM systems have higher voice quality in areas where the strength of the radio signal is only marginal.

Satellite Mobile Communications

It is possible for specifically designed mobile telephones to transmit radio signals directly to, and receive them directly from, certain telecommunications satellites. The mobile telephone is more bulky and very much more expensive than a cellular mobile telephone. However, satellite mobile telephones are useful if a mobile telephone service is needed outside the coverage area of the cellular networks.

When a person makes a call on a satellite mobile telephone, the telephone transmits the call to a satellite. The satellite then transmits the call to a satellite earth station. The earth station then passes the call to a telephone exchange, from which it is carried over the telephone network in the usual way.

The advantage of mobile satellite telephones is that they can be accessed at any location from which a radio transmission can be made to the satellite.

Services to Ships at Sea and Aeroplanes in Flight

Communications to ships at sea, or aeroplanes in flight may take several forms. They include the following:

  1. High Frequency ("HF") radio transmissions. This is an old form of technology which allows communications between a radio station on land and a ship at sea over very large distances, by bouncing radio signals off the upper levels of the earth's atmosphere. It is a very unreliable system of communication.
  2. Very High Frequency ("VHF") radio transmissions. These allow communications to ships at sea over shorter distances, and within defined geographical limits, but with much higher reliability than HF transmissions. VHF radio transmission stations on land are normally connected to the PSTN, so that a telephone call may be made from a telephone via the PSTN and the VHF station to a ship at sea.
  3. Satellite radio transmissions. An international organisation called INMARSAT operates a series of satellites through which radio signals can be sent to ships at sea or aeroplanes in flight anywhere on the earth's surface. The ship or aeroplane must be equipped with a small satellite earth station which has an antenna which points to the nearest INMARSAT satellite. Most telephone carriers have an arrangement with INMARSAT whereby they can transmit telephone calls from their networks via INMARSAT satellites to ships at sea or aeroplanes in flight.

Other Wireless Technologies

Wireless technologies operate by transmitting signals generally within 3,000 Hz and 300 GHz limits of the spectrum. Given the finite nature of the spectrum and to avoid interference, segments of radio frequencies have to date been allocated for specific uses - such as radio services, cordless and mobile phones, paging services, and television broadcasting.

Despite the limitations of spectrum space, the capacity of wireless technology is being improved by the introduction of digital technology, multiplexing, and compression. Frequency re-use through the use of small area base stations can extend wireless capacity, while multiple access techniques including Frequency Division Multiple Access (FDMA ) and Time Division Multiple Access (TDMA) and Spread Spectrum (Code Division Multiple Access) allow multiple users for the same frequency or time.

Satellite Communication

Communication satellites orbit the earth and act as transponders. That is, satellites receive microwave transmissions from an uplink station on earth, and retransmit those down to the downlink location or region on earth. The downlink transmission uses a different frequency in order to avoid interference. Satellites can be used for point-to-point communications (from one single location to another single location, such as telephone services) or point-to-multipoint services (from one location to many places simultaneously, such as broadcasting services).

Satellites can either be in an equatorial, elliptical or a polar orbit. Only equatorial orbits can be geostationary. A geostationary orbit (GSO) allows a satellite to have a height and velocity which causes the satellite to appear stationary from earth. In other words, the satellite remains above a particular region on earth all the time.

Apart from using different frequencies on the uplink and on the downlink paths as described above, interference is avoided by (i) separating satellites by defined distances, and (ii) ensuring different satellites use different frequencies on the limited spectrum suitable for space communications. The scarcity of orbit positions and spectrum are the motivations for much of satellite regulation.

The advantages of using satellites are that a satellite has the ability to offer communications facilities to a large region very quickly. This region is described as the satellite's footprint. In addition, set-up and running costs are independent of terrain. It may therefore be more economical to link locations by satellite than lay cable across mountains, oceans, or wastelands. Finally, communications satellites are generally very reliable.

The disadvantages of satellite communications are primarily that they are very costly, but in addition, depending on the orbit chosen, if the satellite is used for two-way communications (eg a voice conversation or two-way data transmissions) there can be unacceptable transmission delays (called propagation delay). A further disadvantage is that with existing technology, a satellite has a limited lifespan.

Due to the broadcast nature of satellite transmissions, the privacy of telecommunications may be jeopardised. Security issues must be considered and encryption is an available solution.

The most recent developments in satellite technology involve proposals to put in place a new series of satellites which orbit much closer to the earth. Rather than being in geo-stationary orbit, remaining in the same position over particular counties all the time, the LEO (low earth orbiting) satellites would form a ring around the earth, creating the capacity to transmit signals from any point on earth to any other point, which would be capable of being received on a small handheld mobile phone.

Satellites can be used for a variety of services including telecommunications, scientific, earth observation and weather uses. The table below summarises only some of the uses of telecommunications satellites:



Satellites fulfil a variety of functions including:

* Direct broadcasting services from satellite to viewers (DBS)

* head end feeds to large area networks

* international programme distribution

* satellite news gathering feeds (SNG) and news distribution.

Mobile phone

* One contemplated initiative is the Iridium system, originally proposed by Motorola. The $3.4 billion proposal is to have an international network of 66 low-orbit satellites (hence short transmission delays) each equipped with inter-satellite communications links. Calls will be made from handsets similar to the current cellular mobile telephones. For low population densities and remote areas, this system may be more economical than implementing a full terrestrial telephone system. The expected launch date is 1998.

* Another initiative is that proposed by the Teledesic Corporation consortium including Microsoft's Bill Gates. This project is based on a system of 840 satellites, with an estimated cost of $9 billion and a projected launch date of 2001.

Multi-point data networks

* VSAT (Very Small-Aperture Terminals) networks employ a satellite to create a virtual data network. This technology can establish dependable data connections where the terrestrial data network is inadequate.


Microwave is a radio based transmission system which operates in the high end of the frequency spectrum, transmitting a narrow beam of radio signals from one single point to another single point using transmitters and receivers which are generally placed in high towers or on the tops of buildings. The point-to-point transmission system provides an alternative to wire-based telecommunications cables at the higher level of a network, or is appropriate for use in private lines or leased lines. Micro-wave enables a signal to be re-transmitted to a receiving site without the installation of any cables.

The key disadvantage of micro-wave services is that they can only transmit signals by uninterrupted line of sight. This means that the signal will not be received if a mountain or a high building stands between the transmitter and the receiver, and the maximum distance the signal can travel before needing to be received and re-transmitted is about 50 kilometres, requiring new towers or re-transmission sites each time this limit is reached.

Although the performance of micro-wave signals is less reliable than wire-based transmission and can be affected by weather, the system does offer a greater bandwidth than copper cables, and the reductions in the costs of micro wave systems may be sufficient to make the technology attractive where it can be used to avoid the costs of laying cable.


A development of mobile telephone technology is Personal Communications Networks or Services (PCN/PCS) which differ from current mobile technology in that they operate with a smaller telephone unit, based on a digital system of a greater number of lower powered transmitters and micro-cells than the current mobile system. Using satellites, this system would enable global coverage in a mobile network.

The objective of PCN or PCS is to provide a service which allows for connection directly to the person wherever they are via a single number. The combination of the smaller handset and complete coverage would provide the capacity to replace fixed handsets entirely with a PCS service.

Interconnection Between Networks

Where there is more than one telephone (or other form of telecommunication network), it is desirable for all of the networks to be connected to each other so as to enable some telephone calls to be carried partly by one network and partly by another. This is required in order to deal with the following situations:

  1. if a telephone user whose telephone is connected to one network places a call to a person whose telephone is connected to another network, the first part of the call will obviously be carried on the calling party's telephone network, however at some stage the call needs to be transferred to the called party's telephone network;
  2. if a person whose telephone is connected to one telephone network makes a long distance call to another person connected to the same network, but desires the trunk (or long distance) part of the call to be carried by a different carrier, the first part of the call (from the calling party to an exchange near the calling party) will be carried on the first network, the second part of the call (from that exchange to an exchange near the called party) will be carried on the second network, and the final part of the call (from the second exchange to the called party) will again be carried on the first network.

One of the most fundamental features of a telephone network is that every telephone is able to be connected to every other telephone by the operation of switching. This is called "any-to-any connectivity". Where there is more than one network, and the networks are not interconnected, this feature of the telephone system would disappear. Customers connected to one network would not be able to make a telephone call to customers connected to another network. Accordingly, in order to retain the ubiquitous nature of a switched telephone system, namely, that any telephone can call any telephone, it is essential that the networks are interconnected.

The place at which one network interconnects with another is commonly referred to as a point of interconnect ("POI"). There can be any number of POIs. For example:

  1. it would in theory be possible to have just one POI. All calls passing from one network to another would be routed through that POI;
  2. it would also be possible in theory to have a POI in every telephone exchange. This would enable each carrier to have maximum flexibility in determining which part of each call would be carried by the other carrier;
  3. in practice, there is normally more than one POI, but there is not a POI in every exchange. This is for a variety of reasons, some of which are technical and some of which are economic.

A telecommunications carrier seeking to transmit a telephone call over the network of another carrier is commonly referred to as the interconnecting carrier. The carrier which is permitting the interconnecting carrier to transmit a call on its network is commonly referred to as the access carrier.

In practice, POIs are usually situated in telephone exchanges within the access carrier's network. The interconnecting carrier is given a small space within the access carrier's exchange building in which the interconnecting carrier may install its own equipment, such as multiplexing equipment and transmission interface equipment. A transmission medium belonging to the interconnecting carrier, for example, a fibre optic cable, enters the POI space within the access carrier's exchange. In the POI space, the information transmitted on the cable is processed by the interconnecting carrier's equipment in order to produce a transmission on a transmission medium which conforms with agreed technical specifications for transmissions passing between the carriers.

Each transmission medium carrying such a transmission terminates at a point within the POI space which represents the actual point of interconnection between the carriers. There is often a jack or other form of interconnection device where the transmission medium terminates. The access carrier plugs its own transmission medium into the jack and from that point is responsible for connecting the transmission medium in an appropriate way to the access carrier's exchange so as to allow the transmission on that transmission medium to be carried by the access carrier's network.

If an interconnecting carrier has very few customers directly connected to its network, it is desirable for the interconnecting carrier to have POIs in as many of the access carrier's exchanges as possible in order to minimise the portion of the call carried by the access carrier. If, for instance, the interconnecting carrier had a POI in every local exchange of the access carrier, the access carrier would never need to carry the call over a distance longer than the distance between a telephone and the local exchange of the telephone.

An interconnecting carrier can only install a POIs in those exchanges of the access carrier which are capable of operating as gateway exchanges. A gateway is an exchange with the following characteristics:

  1. The trunk transmission lines entering and leaving the exchange are digital, rather than analogue lines. The reason for this is that it is easier to ensure compatibility between the electrical characteristics of the transmissions on the access carrier's trunk lines, and the electrical characteristics of transmissions on the interconnecting carrier's trunk lines, when the lines are digital, rather than analogue.
  2. The exchange must use common channel signalling which conforms to an agreed standard. If this was not the case, the information in the signalling system of one carrier would not be able to be interpreted and acted upon by the other carrier.
  3. The exchange must be one which is capable of passing CLI information to the interconnecting carrier. This is essential because when a customer connected to the access carrier makes a telephone call using the long distance transmission lines of the interconnecting carrier, the interconnecting carrier has to know the identity of the customer on the access carrier's network who made the call. CLI is the means by which the access carrier's exchange informs the interconnecting carrier's exchange of the identity of the calling party. If it was not informed of the identity of this customer, the interconnecting carrier would not be able to bill the customer for carrying the long distance portion of the call. Therefore, any exchange which does not have CLI capability cannot be used as a POI.
  4. The exchange must also have a function known as call charge recording. This means that a computer within the exchange keeps a record of information including:
    1. the starting time;
    2. the duration;
    3. the number of the calling party; and
    4. the number of the called party,

    in respect of each and every call which passes through the exchange. Each record within the computer's database of the information for one such call is known as a call charge record ("CCR"). This information must be kept by the access carrier so that it can bill the interconnecting carrier for that part of the call which was carried over the access carrier's network.

The exchange must be one which is capable of recognising which incoming calls are to be carried by the interconnecting carrier's network.

When the interconnecting carrier is informed of which exchanges in the network of the access carrier are capable of acting as gateway exchanges, it must:

  1. decide in which of those exchanges it will establish a POI; and
  2. obtain transmission capacity so that each POI is connected by a transmission medium to the interconnecting carrier's network.

The computers in the exchange must be reprogrammed so that they can recognise which calls are to be carried by the interconnecting carrier and can route those calls to the appropriate POI rather than to the called party.

"Preselection" occurs when consumers are asked to choose or preselect which telephone company they want to be their primary carrier.

Routing of Calls when Trunk Part of the Call is Carried by a Second Network

It is now possible to explain the way calls are routed when:

  1. the calling party and the called party are connected to different networks; and
  2. the parties are connected to the same network, but a portion of the call is carried over another network.

When a call is made between two parties, both of whom are connected to the same network, but the trunk part of the call is to be carried over another network, the call is routed as follows. The local exchange of the calling party must recognise the call as one which is to be carried by the other carrier by either:

  1. recognising particular digits in the dialled number (generally additional digits in front of the number called); or
  2. recognising that the calling party is a customer which has pre-selected the other carrier to carry its long distance calls.

Preselection is often called "equal access", whereas requiring customers of the new entrant to dial extra digits in front of the area code and number is regarded as being unequal access. This is because preselection means that a customer uses the same dialling pattern to access the competing long distance services irrespective of the fact that the customer remains connected to the local network of one of those providers of competing long distance services. Preselection helps reduce the advantage which the former monopoly has in long distance competition from its control of the local network.

On reaching a POI, the call is passed back to the access carrier and the access carrier carries the call to the called party. The diagram below shows the way a call is carried from the access carrier's network to the interconnecting carrier's network, and then completed by the access carrier's network.

An interconnecting carrier would normally pay the access carrier for carriage of the call. Such payments take different forms, depending on the arrangement between the carriers.

Alternative Transmission Systems

There are several advantages of having numerous alternatives for the transmission of telecommunications traffic between places in the network. They include:

  1. The total capacity for the carriage of telecommunications traffic between those places is higher than if there is just a single transmission medium.
  2. The carrier has flexibility in allocating transmission resources to satisfy traffic demands in various parts of the network.
  3. If one transmission medium is damaged or faulty (for example, if a cable is broken) traffic can still be transmitted between the two places using the alternative transmission mediums until the fault is repaired.

Enhanced Services Exchange

The normal way in which the enhanced services exchange is used is as follows. When a call is made which involves the use of enhanced services, the Local/Trunk Exchange through which that call has been routed makes an inquiry, using sophisticated signalling techniques, of the Enhanced Services Exchange about the way in which that call should be treated. For example, if a caller makes a call to a freecall number, the Local/Trunk Exchange through which the call is made will recognise the number as a number which must be handled in a special way. It sends signalling information to the Enhanced Services Exchange to inquire about the way it should route the call and charge for the call. The Enhanced Services Exchange responds with further signalling information containing the telephone number to which the call should be routed as well as the telephone number to which it should be charged. The Local/Trunk Exchange acts upon this signal information and routes and charges the call accordingly.


A range of possible charging options and plans are offered by telecommunication services providers. The traditional time-based method of charging was simply based on the duration and distance of a call measured through each local exchange line. New exchanges allow computerised collection of call charge information, and permit itemised accounts to be prepared for customers. Calling charge patterns vary, but include flat charges, an untimed rate, a timed rate or other combinations.

Glossary of Terms

Access Carrier - A carrier which provides a service on its network to another carrier.

Add-Drop Multiplexer - A multiplexer used to extract selected channels from or add channels to a larger number of channels on a fibre optic cable.

ADM - See Add-Drop Multiplexer.

Advanced Mobile Phone System - A technical standard for analogue cellular mobile telephone systems.

AMPS - See Advanced Mobile Phone System.

Analogue - The term used to describe the continuously variable wave-form nature of voices and other signals.

ATUP - A version of C7 signalling used in the trunk lines of Telstra's gateway and some other exchanges.

Bandwidth - The range of frequencies which an analogue transmission medium is capable of carrying, expressed in Hertz (cycles per second).

Base Station - Radio transmitter and receiver used for transmitting and receiving calls to or from mobile telephones in a particular cell.

C7 - See CCS 7

Call Charge Record - A record kept by an exchange of information relating to a call passing through that exchange.

Call Charge Recording - The keeping of call charge records.

Calling Line Identification - The telephone number of the calling party.

CAN - See Customer Access Network.

XCR - See Call Charge Record.

CCS 7 - Also known as C7, Common Channel Signalling System No.7 is the most widely used internationally accepted standard for the common channel signalling systems.

Cell Splitting - The subdivision of a mobile telephone cell into a series of smaller cells.

Cellular Mobile Telephone Systems - Mobile telephone system in which the coverage area is divided up into a large number of small areas, called cells, each of which has its own base station.

CLI - See Calling Line Identification.

Co-axial Cable - Cable with a metal core and insulated sheath along which information is conveyed in the form of electrical current.

Common Channel Signalling - The system of combining signals for many voice paths into one signalling path which is separate from the voice path.

Common Control Switching - An exchange in which all switching systems are under the common control of a computer.

Computer Data Transmissions - The transmission of computer data across a telecommunications network.

Copper Wire - Copper wires allowing information to be conveyed in the form of electrical current.

Coverage Area - The area in which a mobile telephone user can receive and send radio transmissions.

Cross-Bar Exchange - An exchange which makes use of miniaturised electro-mechanical switches under common control.

Customer Access Network - The portion of the PSTN which comprises the transmission system between the telephone and the local exchange.

Data Transmission - The transmission of data, such as between computers, over a telecommunications network.

Digital - The representation of a signal in the form of a stream of binary numbers rather than as an analogue electrical signal.

Digital Compression - A technique used to reduce the number of digits to required to represent a signal thereby increasing the number of channels able to be carried by a single transmission medium.

Drop-Out - When a call on a mobile telephone is prematurely cut off due to congestion or lack of coverage of the mobile system.

E1 - A digital transmission standard applying to transmissions at a rate of 2048kb/s (2Mb/s).

Exchange - Performs the switching function necessary to establish a connection between two telephones.

Extension Ring - Rings of fibre optic cable which Optus has laid in areas where there are customers of sufficient size who wish to be directly connected to Optus' network.

Facsimile Transmissions - The transmission of an image (eg. of a written document) across a telecommunications network.

Fibre Optic Cable - Cable incorporating a number of very thin strand of glass on which information is conveyed in the form of pulses of light.

Frequency Division Multiplexing - Multiplexing used in analogue transmission systems whereby information is transmitted simultaneously within different frequency ranges over the same transmission medium.

Frequency Re-Use - The ability of a cellular mobile system to use the same radio frequency for simultaneous calls in different cells.

Gateway Exchange - An exchange at which a POI is capable of being established.

Global System for Mobiles - A technical standard for digital cellular mobile telephone systems.

Groupe Speciale Mobile - See Global System for Mobiles.

GSM - See Global System for Mobiles.

Hand-Off - The process of transferring a telephone conversation from a particular frequency in one cell to a new frequency in an adjacent cell as the user moves between cells.

ICCA - See Inter-Carrier Charging Area.

ICRG - See Intercarrier Relations Group.

Integrated Services Digital Network - A form of telecommunications network capable of carrying both voice (telephone) and data traffic.

Inter-Carrier Charging Area - One of the 204 regions in which Australia is divided for charging purposes.

Inter-Carrier Relations Group - A forum established under the Access Agreement for discussion of issues relating to the interconnection of Telstra's and Optus' Networks.

Inter-ICCA Charge - The charge paid by Optus to Telstra for Telstra to carry traffic from one ICCA to another.

Inter-Office Optical Fibre - Fibre optic cables between Optus' exchanges in Brisbane, Sydney, Canberra, Melbourne and Adelaide.

Interconnecting Carrier - A telecommunications carrier to which a service is provided by another carrier.

Internet - a network connecting computers within Australia and around the world.

Intra-ICCA Charge - The charge paid by Optus to Telstra for Telstra to carry traffic within an ICCA.

IOF - See Inter-Office Optical Fibre.

ISDN - see Integrated Services Digital Network.

Leased Line - Dedicated transmission capacity leased along a particular route in the network.

Local Exchange - The exchange to which a customer is directly connected, usually the closest exchange to the customer.

Long Distance Network - See Trunk Network.

Metropolitan Optical Fibre Rings - A fibre optic cable which runs in a loop around the metropolitan area of a city.

Microwave - A high frequency form of radio transmission.

Mobile Telephones - Telephones which are not fixed and which communicate with the network by transmitting radio signals.

Multi-metering - See Real Time Charging.

Multiplexing - A technique enabling transmission of multiple signals or voice channels simultaneously along a single transmission medium.

Network Conditioning - The process of modifying the functional operation of telephone exchanges by means of re-programming or re-wiring. Such modifications can change the way in which the exchange handles a call or signalling information and may involve changes in routing, number recognition, call charge recording, etc..

Ordering and Provisioning Working Group - Working group established under the ICRG.

PABX - A switchboard used by some companies to switch incoming telephone calls to the appropriate telephone extension within the company.

POI - See Point of Interconnect.

Point of Interconnect - The point at which one network interconnects with another.

Private Network - a network comprising a number of leased lines owned by a private customer.

PSTN - See Public Switched Telephone Network.

Public Switched Telephone Network - The switched telephone telecommunications network to which public customers are connected.

Radio Transmissions - Transmission of information in the form of radio waves, without the need for a physical cable.

Real Time Charging - A PABX feature which determines the actual cost of any particular call made by a person from his or her telephone extension.

Signalling System - The means by which telephones inform telephone exchanges, and telephone exchanges inform each other, of the important features of each telephone call.

Stored Program Control Exchanges - An exchange in which the function of interpreting and acting upon signalling information is provided by computers.

Switch - See Exchange.

Switching System - A system which allows the temporary connection of the telephone of the calling party with the telephone of any other party selected by the calling party.

Telecommunications Network - A system for the transmission of information between one party and another. It comprises transmission, switching and signalling functions.

Telegram and Telex Networks - telecommunications' networks which carry information in the form of text.

Time Division Multiplexing - Multiplexing used in digital systems whereby information from several low speed transmission lines is transmitted sequentially on a single high speed transmission line.

Toll Free Services - telecommunications services where the caller pays either nothing or the cost of a local call and recipient of the call pays for the remainder of the cost of the service.

Transmission Interface Equipment - Equipment used to convert one form of transmission to another.

Transmission Medium - The medium on which information is conveyed, such as copper wire, co-axial cable, fibre optic cable and radio.

Transmission System - A means by which information passes from one point to another, comprising transmission mediums and transmission interface equipment.

Trunk Exchanges - Transit exchanges through which a long distance call may pass on its route between 2 local exchanges.

Trunk Network - The transmission, switching and signalling systems within the PSTN which enable calls to be routed from one local exchange to another.

Usage Charge - One of the agreed interconnect charges paid by Optus to Telstra for gaining access to Telstra's network.

Virtual Private Networks - an enhanced feature of a switched network which gives it the appearance and functionality to a particular user of a private network.

2Mb/s - A transmission speed of 2,048,000 binary numbers (bits) per second.

64kb/s - A transmission speed of 64,000 binary numbers (bits) per second.

Current papers on Internet Censorship (as at February 2000):

Internet Censorship - Judgment Day for the ABA

Silver Bullets and Golden Egged Geese - a cold look at internet censorship

An Essential Guide to Internet Censorship in Australia


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