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Digital communications is the physical transfer of data (a digital bit stream) over a point-to-point or point-to-multipoint communication channel. Examples of such channels are copper wires, optical fibres, wireless communication channels, and storage media. The data are represented as an electromagnetic signal, such as an electrical voltage, radio-wave, microwave, or infrared signal.

While analog transmission is the transfer of a continuously varying analog signal, digital communications is the transfer of discrete messages. The messages are either represented by a sequence of pulses by means of a line code (baseband transmission), or by a limited set of continuously varying wave forms (passband transmission), using a digital modulation method.

  • A baseband signal ("digital-over-digital" transmission): A sequence of electrical pulses or light pulses produced by means of a line coding scheme such as Manchester coding. This is typically used in serial cables, wired local area networks such as Ethernet, and in optical fiber communication. It results in a pulse amplitude modulated signal, also known as a pulse train.
  • A passband signal ("digital-over-analog" transmission): A modulated sine wave signal representing a digital bit-stream. The signal is produced by means of a digital modulation method such as PSK, QAM or FSK. The modulation and demodulation is carried out by modem equipment. This is used in wireless communication, and over telephone network local-loop and cable-TV networks.

The passband modulation and corresponding demodulation (also known as detection) is carried out by modem equipment.

Data transmitted may be digital messages originating from a data source, for example a computer or a keyboard. It may also be an analog signal such as a phone call or a video signal, digitized into a bit-stream for example using pulse-code modulation (PCM) or more advanced source coding (analog-to-digital conversion and data compression) schemes. This source coding and decoding is carried out by codec equipment.

Data has been sent via non-electronic (e.g. optical, acoustic, mechanical) means since the advent of communication. Analog signal data has been sent electronically since the advent of the telephone. However, the first data electromagnetic transmission applications in modern time were telegraphy (1809) and teletypewriters (1906), which are both digital signals.

Data transmission is utilized in computers in computer buses and for communication with peripheral equipment via parallel ports and serial ports such as RS-232, Firewire, and USB. The principles of data transmission are also utilized in storage media for Error detection and correction.

In telephone networks, digital communication is utilized for transferring many phone calls over the same copper cable or fiber cable by means of Pulse Code Modulation (PCM), i.e. sampling and digitization, in combination with Time Division Multiplexing (TDM).

Transmitting analog signals digitally allows for greater signal processing capability. The ability to process a communications signal means that errors caused by random processes can be detected and corrected. Digital signals can also be sampled instead of continuously monitored. The multiplexing of multiple digital signals is much simpler to the multiplexing of analog signals.

Because of all these advantages, and because recent advances in wideband communication channels and solid-state electronics have allowed scientists to fully realize these advantages, digital communications have grown quickly. Digital communications are quickly edging out analog communication because of the vast demand to transmit computer data and the ability of digital communications to do so.

The digital revolution has also resulted in many digital telecommunication applications where the principles of data transmission are applied. Examples are second-generation and later cellular telephony, video conferencing, digital TV, digital radio, telemetry.

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