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Basic Phone Services and Circuits

Here's how to go the last mile with the phone company.

Table 1—Telephone Service Types

Telephone company offerings are complex. Unless we have corporate responsibility for provisioning voice or data telecommunications services from the telephone company, most of us rarely have any involvement with telephone lines aside from the analog local loop that provides the voice services that allow telemarketers to call us during dinner.

While telephone company offerings can be really hard to understand and to distinguish between even that is easy in comparison to understanding their costs. This tutorial can't begin to tackle the cost issue, but it will try to make the relevant distinctions among some of the more frequently encountered products and services available from telephone service providers.


The first important distinction is between analog and digital lines. Analog signals vary continuously, and they represent particular values, such as the volume and pitch of a voice or the color and brightness of a section of an image. Digital signals have meaning only at discrete levels-in the most common case, the signal is either on or off, present or absent, 1 or 0.

Analog telephone lines are the legacy systems of the telephone universe. The great preponderance of residential telephone lines is analog. Fifty-year-old telephones will probably work on your local loop-the connection between your home telephone jack and the telephone company's central office. (Your central office is probably not a gigantic building downtown-the average local loop is about 2.5 miles long [four kilometers], so the "central office" is most often an inconspicuous building in or near your neighborhood.)

When you talk on the telephone, the microphone in the "receiver" (while you're talking, it's actually a transmitter) produces an analog signal that travels to the central office and is switched either to another local destination or to other switching offices that connect it to a remote destination. Dialing the telephone produces the in-band signals that tell the switching system where to route the call. The telephone companies have learned a great deal about the electrical characteristics of human voice signals over the years, and they have determined that we will be reasonably satisfied with voice signals that do not transmit frequencies below 300Hz or above 3,100Hz. Note that high fidelity is usually considered to be a system that can reproduce frequencies between 20Hz and 20KHz without distortion-while voices are recognizable with the standard telephone frequency range, that range of frequencies is likely to be inadequate for other types of sounds-for instance, music sounds lousy over the telephone. To allow for gradual roll-offs of high and low frequencies, the telephone companies allow an analog telephone channel a bandwidth of 4,000Hz to work with.

At the central office, the odds are that the analog signal will be digitized in order to be switched across the telephone network. Aside from Giblet County, AK, and Rat Fork, WY, the U.S. telephone network that interconnects central offices uses digital signaling. Although many urban business telephone users have digital services direct to their PBXs or data communication devices, and ISDN lines are digital, the local loop is sometimes referred to as "the last mile," because residences, generally saddled with analog-only transmission facilities, are rarely capable of bandwidth greater than 4,000Hz.


Modems convert digital signals from a computer into analog signals in the telephone frequency range. There is a hard upper limit to the capacity of a channel with a given bandwidth. A channel's throughput in bits per second depends on the bandwidth and the achievable signal-to-noise ratio. The current top throughput rate for modems of 33.6Kbps is quite close to the limit. As users of 28.8Kbps modems know, the actual throughput achievable on normally noisy analog lines is rarely the full-rated value, and it may be much lower. Compression and caching and other tricks can mask the limit to an extent, but we'll see perpetual motion machines before we see a modem with, say, 50Kbps or even 40Kbps throughput on ordinary analog telephone lines.

When the telephone company reverses the process and digitizes an analog signal, it uses a 64Kbps channel. (This conversion is a worldwide standard.) One of these channels, called a DS0 (digital signal, level zero), is the basic building block for telephone processes. You can agglomerate (the precise term is multiplex) 24 DS0s into a DS1. If you lease a T-1 line, you get a DS1 channel. With synchronization bits after each 192 bits (that is, 8,000 times a second), the DS1 capacity is 1.544Mbps (the product of 24 and 64,000, added to 8,000).


The second important distinction to make about telephone lines is whether they are dedicated circuits you lease or switched services you buy. If you order a T-1 line or a low data-rate leased line such as dataphone digital service (DDS), you are renting a point-to-point facility from the telephone company. You have dedicated use of such a circuit-with 1.544Mbps (T-1) or 56Kbps (low data rate) of capacity, respectively.

While frame relay services are switched through a cloud frame by frame, they are invariably sold as permanent virtual circuits, where the customer specifies the end points. For purposes of designing a network layout, frame relay links have more in common with dedicated lines than with switched lines, but the cost can be substantially lower for an equivalent capacity. Switched services, such as residential analog telephone service, are services purchased from the telephone company. You can select any destination on the telephone network and connect to it through the network of public switches. You generally pay for connect time or actual traffic volume, so unlike a dedicated line, the bill will be low if usage is low. Switched digital services include X.25, Switched 56, ISDN Basic Rate Interface (BRI), ISDN Primary Rate Interface (PRI), Switched Multimegabit Data Service (SMDS), and ATM. It's also possible to set up private networks that supply these services using your own switching equipment and leased lines or even privately owned lines-for example, if you are a university, a railroad, or a municipal utility.

If the circuit provided by the phone company is already a digital circuit, there is no need for a modem to provide digital-to-analog conversion services between the terminal equipment (phone company talk for such equipment as computers, fax machines, videophones, and digital telephone instruments) and the telephone system. Nonetheless, customer premises equipment still needs to behave like a good citizen of the telephony network. In particular, it must present the correct electrical termination to the local loop, transmit traffic properly, and support phone company diagnostic procedures.

A line that supports ISDN BRI service must be connected to a device called an NT1 (network termination 1). In addition to the line termination and diagnostic functions, the NT1 interface converts the two-wire local loop to the four-wire system used by digital terminal equipment. For digital leased lines-T-1 and DDS-and for the digital services, the digital subscriber line from the phone company needs to be terminated by a channel service unit or CSU. The CSU terminates and conditions the line and responds to diagnostic commands. Customer terminal equipment is designed to interface with a data service unit (DSU), which hands over properly formatted digital signals to the CSU. CSUs and DSUs are often combined into a single unit-a CSU/DSU, of all things. The DSU may be built into a router or multiplexer. So even though end-to-end digital services don't require modems, a piece or two of interfacing hardware is always required for connectivity.


While 33.6Kbps is a stretch for most local loops configured for analog service, the same twisted-pair wiring running between your house and a central office is very likely capable of supplying ISDN BRI service, with 128Kbps of data throughput capacity and another 16Kbps of control and setup capacity. How is this possible? Analog telephone circuits are heavily filtered to keep the signals attenuated outside their 4KHz bandwidth. Digital circuits don't need to be filtered the same way, so the twisted pair cable can support a much greater bandwidth, which allows greater throughput.

Leased 56Kbps and 64Kbps lines and services that run on these lines, such as frame relay and Switched 56, may be delivered on a two-wire digital line or on a four-wire digital line (which has separate wire pairs for transmitting and receiving). T-1 lines as well as ISDN PRI and frame relay are often delivered on four-wire digital lines or perhaps on optical fiber. T-3 lines are sometimes coaxial cable, but most high-capacity traffic is carried on optical fiber. While ISDN is getting a lot of attention as a high-capacity, wide-area connection, it is not the last word on throughput for the "last mile." PairGain (Tustin, CA) and AT&T Paradyne (Largo, FL) market products using Bellcore's (Piscataway, NJ) high bit-rate digital subscriber loop (HDSL) technology. These products serve to equalize local loops dynamically, making it possible to support DS1 throughput-1.544Mbps-over most existing twisted pair local loops, provided that HDSL devices are installed at both ends. (With standard 24-gauge wire, HDSL can be used successfully on local loops up to 2.3 miles long, with no repeaters. Ordinary T-1 circuits require repeaters at least every 3,000 feet to 5,000 feet.) If you want to transport DS1 levels of traffic over the last mile, the alternatives to HDSL are to install "fiber to the curb" at great expense or to install several repeaters on each line, which is not as expensive as all-new fiber but is still costly and imposes a large maintenance cost on the telephone company (and, ultimately, on the customer).

HDSL is not even the final word on improving the throughput of the last mile. Asymmetrical digital subscriber line technology (ADSL), an extension to HDSL, is expected to support throughput as high as 6Mbps in a single direction, with a much lower throughput-perhaps 64Kbps-in the other direction. In a perfect-or at least competitive-world, where customers pay for a telephone service based on the actual cost of delivering that service, a high percentage of analog telephone customers could receive ISDN PRI (or another T-1 service) at a price comparable to today's cost for ISDN BRI.

But, perhaps today's ISDN promoters don't have much to worry about. In most cases, telephone companies can install these special line equalizers and keep the savings to themselves. As is so often the case with tariffed services, there's no requirement that the rates be rational.

Steve Steinke is senior editor of Network Magazine.He can be reached via the Internet at

This tutorial was originally published in the January 1996 issue of LAN Magazine/Network Magazine.


Circuit type Service Switched service Local loop transmission medium
Analog POTS Circuit switched Two-wire twisted pair
DS0 (64Kbps) DDS (leased line) Dedicated line Two-wire or four-wire twisted pair
Frame relay Packet-switched PVC Two-wire or four-wire twisted pair
X.25 Packet switched Two-wire or four-wire twisted pair
Switched 56 Circuit switched Two-wire or four-wire twisted pair
Switched 64 Circuit switched Two-wire or four-wire twisted pair
ISDN BRI Circuit switched Two-wire twisted pair
Multiple DS0 (between 64Kbps and 1.536Mbps in 64Kbps increments) Fractional T-1 Dedicated line Two-wire or four-wire twisted pair
Frame relay Packet-switched PVC Two-wire or four-wire twisted pair
DS1 (1.544Mbps) (24 DS0s) T-1 leased line Dedicated line Four-wire twisted pair or fiber
Frame relay Packet-switched PVC Four-wire twisted pair or fiber
SMDS Packet switched Four-wire twisted pair or fiber
ISDN PRI Circuit switched Four-wire twisted pair or fiber
DS3 (44.736Mbps) (28 DS1s, 672 DS0s) ATM Cell switched Coax or fiber
SMDS Packet switched Coax or fiber

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