Telecommunications and Networks


Telecommunications can be defined as a communication of information by electronic means, usually over some distance. Technology has made the world a small place. Today, it is easy to “reach out and touch someone”; no matter where in the world that person lives. Information, which is being created at a rate that is 200,000 times faster than the growth of the human population, can easily be accessed and delivered, usually within a few seconds, between two points on the planet. Human ingenuity and the development of computer technology have made Telecommunications one of the most powerful technologies of our times. Automated Teller Machines, airline reservations, live broadcasts, remote health care, space exploration, medical research, and learning at a distance are made possible through telecommunications

Some definitions about Telecommunications are as follows:

According to Uma G. Gupta, “Telecommunications refers to transmitting different forms of data (i.e. text, images, voice, graphics, etc) over different media from one set of electronic devices that are geographically separated.”

According to James A O’Brien, “Telecommunications is the sending of information in any form (e.g. voice, data, text and images) from one place to another using electronic media.”

“A Telecommunications system is a collection of compatible hardware and software arranged to communicate information from one location to another.”-Laudon and Laudon

tele simply means “at a distance” and is derived from the Greek word “far away”. Telecommunication is similar to human face-to-face communications in that there is a sender, a receiver, a message, and a medium through which the message is transmitted. Sometimes telecommunication and networks are often used interchangeably.

Managers, end users, and their organizations need to electronically exchange data and information with other end users, customers, suppliers, and other organizations. Only through the Telecommunications networks mangers, end users, teams, and workgroups are enable to electronically exchange data and information anywhere in the world with other end users, customers, suppliers, and business partners. Most business organizations today could not survive without a variety of interconnected computer networks to service their information processing and communications needs. As a manager, entrepreneur, or business professional, you will thus be expected to make or participate in decisions regarding a great variety of Telecommunications and network options. Finally we can say that, Telecommunications network is any arrangement where a sender transmits a message to a receiver over a channel consisting of some type of medium.


In recent years, the term Information Superhighway has been used frequently in the media and in the computer literature. High speed, digital networks with fiber optic and satellite links has made the concept of an information superhighway technically possible and has captured the interest of both business and government. In this concept, local, regional, nationwide, and global networks will be integrated into a vast, “network of networks” The information superhighway system would connect individuals, households, businesses, government agencies, libraries, universities, and all other institutions and would support interactive voice, data, video, and multimedia communications. Information superhighway creates a national information infrastructure that would dramatically increase efficiency and competitiveness by improving economic communications, collaboration, and information gathering. For example, the information superhighway could use electronic mail, videoconferencing, and electronic databank services to enable businesses throughout the country to build products faster through an electronic collaboration in the product design process.


A communication network is any arrangement where a sender transmits a message to a receiver over a channel consisting of some type of medium. The essential components of a Telecommunications system are:

  • Computers
    to process information
  • Terminals
    or any input/output devices that sends and receives data
  • Communication channels, the links by which data or voice are transmitted between sending and receiving devices in a network.
  • Communication processors such as modems, multiplexer, controller, and front-end processor which provide support functions for data transmissions and receptions.
  • Communication software
    which control input and output activities and manages other functions of the communication networks
  1. Computers: Computers of all sizes and types are interconnected by telecommunications network so that they can carry out their information processing assignments. For example, a mainframe computer (it is a large, general-purpose computer with a large memory and excellent processing capabilities.) may serve as a host computer
    (it is a large computer that sends and receive data over a network and performs a number of other important functions, such as checking the data for accuracy, sending error messages to the user if any error is found during transmission) for a large network, assisted by a mainframe serving as a front-end processor, while a microcomputer may act as a network server for a small network of microcomputer workstation.
  1. Terminals: Terminals, such as networked microcomputer workstations or video terminals. Of course, any input/output device that uses telecommunications networks to transmit or receive data is a terminal, including telephones, office equipment, and the transaction terminals.

  1. Telecommunications Channels and Media: Telecommunications channels and media over which data are transmitted and received. Telecommunications channels use combinations of media, such as copper wires, coaxial cables, fiber optic cables, microwave system, and telecommunications network.
  1. Telecommunications processors: Telecommunications processors, which support data transmission and reception between terminals and computers. These devices, such as modems and front-end processors, perform a variety of control and support functions in a telecommunications network. For example, they convert data from digital to analog and back, code and decode data, and control the accuracy and efficiency of the communications flow between computers and terminals in a telecommunications network.

  1. Telecommunications Control Software: It consists of programs that control telecommunications services and manage the functions of telecommunications networks. Examples are telecommunications monitors for mainframe host computers; network operating systems for microcomputers network servers, and communications packages for microcomputers.


In order to send and receive information from one place to another, a telecommunications system must perform a number of separate functions. These functions are largely invisible to the people using the system. The functions of telecommunications are:

  • A telecommunication system transmits information
  • Establishes the interface between the sender and the receiver
  • Route messages along the most efficient paths
  • Performs elementary processing of the information to ensure that the right message gets to the right receiver
  • Performs editorial tasks on the data (such as checking for errors and rearranging the format),
  • Converts messages from one speed (say, the speed of a computer) into the speed of a communications line or from one format to another, and
  • The telecommunications system controls the flow of information.


A telecommunications network typically contains diverse hardware and software components that need to work together to transmit information. Different components in a network can communicate by having common set of rules that enable them to ‘talk’ to each other. This set of rules and procedures governing transmission between two points in a network is called a protocol. The primary purposes of protocol are to accurately identify each device in the communication path, to ensure that each message is transmitted accurately to the right destination and to detect and correct errors as they occur. One of the most popular protocol is TCP/IP.


Company or user who provides an information source for use in a videotext system

Is responsible for moving packet of data from node to node. IP forwards each packet based on a four-byte destination address (the IP number). The Internet authorities assign ranges of numbers to different organizations. The organizations assign groups of their numbers to departments. IP operates on gateway machines that move data from department to organization to region and then around the world.


standard data transmission protocol that provides full duplex transmission, the protocol bundles data into packets and checks for errors

– is responsible for verifying the correct delivery of data from client to server. Data can be lost in the intermediate network. TCP adds support to detect errors or lost data and to trigger retransmission until the data is correctly and completely received.


Data travels through a telecommunication system in the form of electromagnetic signals. Signals are represented in two ways: analog and digital signals.

An analog signal is represented by a continuous waveform that passes through a communication medium. Analog signals are used to handle voice communications and to reflect variations in pitch.

A digital signal is a discrete rather than a continuous waveform. It transmits data coded into two discrete states: 1-bits and 0-bits, which are represented as on-off electrical pulse. Computer is by nature a digital device. Most computers communicate with digital signals, as do many local telephone companies and some larger networks. But if a telecommunication system, such as a traditional telephone network, is set up to process analog signals- the receivers, transmitters, amplifiers, and so fourth- a digital signal cannot be processed without some alternatives. All digital signals must be translated into analog signals before they can be transmitted in an analog system. The device that performs this translation is called a modem (MOdulation /DEModulation). A modem translates the digital signals of a computer into analog form for transmission over ordinary telephone lines, or it translates analog signals back into digital form for reception by a computer.


Telecommunication channels are the means by which data and other forms of communications are transmitted between the sending and receiving devices in a telecommunications network. A telecommunication channel makes use of a variety of telecommunications media. These include twisted-pair wire, coaxial cable, fiber optics, terrestrial microwave, satellite, and wireless transmission.

  1. Twisted-Pair Wire: Ordinary telephone wire, consisting of copper wire twisted into pairs. These lines are used in established communications networks throughout the world for both voice and data transmission. Thus, twisted-pair wiring is used extensively in home and office telephone systems and many local and wide area networks.
  2. Coaxial Cable: Coaxial cable consists of thickly insulated copper wire, which can transmit a larger volume of data than twisted wire can. They allow high-speed data transmission (200 megabits per second) and are used instead of twisted-pair wire lines in high-service metropolitan areas, for cable TV systems, and for short-distance connection of computers and peripheral devices. Coaxial cables are also used extensively in office building and other work sites for local area networks.
  1. Fiber optic cable consists of strands of glass or transparent plastic fiber, each the thickness of a human hair, which are bound into cables. Data are transmitted into pulse of light, which are sent through the fiber optic cable by a laser device at a rate from 500 kbps to several billion bits per second. This is about 60 times greater than coaxial cable and 3,000 times better than twisted pair lines. Fiber optic cable is considerable faster, lighter, and more durable than wire media and is well suited for large volume of data.
  1. Terrestrial Microwave: It involves earthbound systems, which transmit high-speed radio signals in a line-of-sight path between relay stations spaced approximately 30 miles apart. Microwave antennas are usually placed on top of buildings, towers, hills and mountain peaks, and they are a familiar sight in many sections of the country. They are still a popular medium for both long-distance metropolitan area networks.
  1. Wireless transmissions: Wireless transmission sends signal through air or space without being tied to a physical line. This medium has been very popular for sending data to long distance. The most popular wireless transmission system is land based or satellite based microwave system. Microwave systems transmit high-frequency radio signals through air and are widely used for high volume, long distance communications. Microwave signals follow a straight line and do not bend with the curvature of the earth. This is why land-based transmission stations are positioned 37 miles apart. Today, common uses of wireless data transmission include pagers, cellular telephones, microwave transmissions, communication satellites, mobile data networks, personal communications services, personal digital assistants, and even television remote controls.


The communication capabilities of telecommunication channels can be classified by bandwidth. This is the frequency range of the channel, which determines the channel’s maximum transmission rate. Data transmission rates are typically measured in bits per second (BPS). This is sometimes referred to as the baud rate, though baud is more correctly a measure of signal changes in a transmission line.

  1. Transmission Speed:
    Voice band, or low-speed analog, channels are typically used for transmission rates from 300 to 9,600 BPS, but can now handle up to 1 million BPS (MBPS). They are usually unshielded twisted-pair lines commonly used for voice communications, but are also used for data communications by microcomputers, video terminals, and fax machines. Medium-band, or medium-speed, channels use shielded twisted-pair lines for transmission speeds from 9,60 BPS up to 10MBPS.

    Broadband, or high-speed digital, channels allow transmission rates at specific-intervals from 256,000 BPS to several billion BPS. Typically, they use microwave, fiber optics, or satellite transmission. Figure-1
    compares the transmission speed and relative costs of the major types of transmission media.




Twisted Wire

300 BPS- 10 MBPS


BPS = Bits Per Second


256 KBPS- 100 MBPS

MBPS = Megabits Per Second


256 KBPS- 100 MBPS

KBPS = Kilobits Per Second

Coaxial Cable

56 KBPS – 200 MBPS

GBPS = Gigabits Per Second

Fiber Optic cable

500 KBPS – 10 GBPS


Typical Speed and Cost of Telecommunications Transmission Media

  1. Transmission Mode: The two models of transmitting data are called asynchronous and synchronous transmission. Asynchronous transmission transmits one character at a time, with each character preceded by a start bit and followed by a stop bit. Asynchronous transmission is normally used for low-speed transmission at rates below 2,400 BPS. Synchronous transmission transmits group of characters at a time, with the beginning and end of a character determined by the timing circuitry of a communications processor. Synchronous transmission is normally used for high-speed transmission exceeding 2,400 BPS.
  1. Transmission Direction: Transmission must also consider the direction of data flow over a telecommunications network. In simplex transmission, data can travel only in one direction at all times. In half-duplex transmission, data can flow two ways but can travel in only one direction at a time. In full-duplex transmission, data can be send in both directions simultaneously.


There are many different types of telecommunications networks. However, main telecommunications networks are:

  1. Private Branch Exchange (PBX): A Private branch exchange is an electronic switching device (or a special computer), located within the company that automatically switches calls between the company’s telephone lines and those of a local telephone company. It is a small telephone exchange that is owned by the organization, as opposed to the large public telephone exchange owned by telephone companies.

A PBX performs a number of functions, such as call routine, call forwarding, redialing, storing, tracing the origin of calls for statistical purpose, and automatically determines the least expensive route for a long distance call. Today PBX can carry both voice and data to create local networks. The primary disadvantage of a PBX is that it can cover only a small geographical area, unless it is connected to other PBX or to value-added networks. Also, since PBX use only telephone lines, they cannot handle large volume of data.

  1. Local Area Networks: Local Area Networks (LANs) connect computers and other information processing devices within a limited physical area, such as an office, a building, manufacturing plant, or other work site so that knowledge workers can share data, information, messages, software, and even peripherals, such as printer.

    LANs generally have higher transmission capabilities than PBXs, a very fast PBX can have a maximum transmission capacity of over 2 megabits per second, LANs typically transmit at a rate of 256 kilobits per second to cover 100 megabits per second. LANs use a variety of telecommunication media, such as twisted-pair, coaxial cable, and, in recent years, fiber optics and wireless communications to interconnect microcomputer workstations and computer peripherals. To communicate over the network, each PC must have a circuit board installed called a network interface card.

  1. Wide Area Networks: Telecommunications networks covering a large geographical area are called remote networks, long-distance networks, or, more popularly, wide area networks. Network that covers a large city or metropolitan area can also be included in this category. Such large networks have become a necessity for carrying out the day-to-day activities of many business and government organizations and their end users. Thus, WANs are used by

manufacturing firms, banks, retailers, distributors companies, and government agencies to transmit and receive information among their employees, customers, suppliers, and other organizations across cities, regions, countries, or the world. The primary difference between a LAN and a WAN is that a WAN covers greater geographical distance than a LAN.

  1. Value Added Networks: VANs are public data networks that add value to the basic communication services, such as access to commercial databases and software, correction of transmission errors, establishing compatibility between previously incompatible computers and terminals, E-mail, and videoconferencing. A subscriber to a VAN service pays a monthly fee depending on its level of use; VANs present an attractive alternative for companies that want to receive the benefits of telecommunications without investing large amounts of capital in hardware.


A manager, entrepreneur, or business professional may need to know what business value is created by the business applications of telecommunications? A good way to answer this question is shown by the figure. Information technology, especially in telecommunications based business applications, helps a company overcome geographic, time, cost, and structural barriers to business success.

Figure outlines examples of the business value of these four strategic capabilities of telecommunications and other information technologies. This figure emphasizes how several applications of electronic commerce can help a firm capture costs, as well as supporting quickly to end users at remote geographic locations at reduced costs, as well as supporting its strategic organizational objectives.

For example, traveling salespeople and those at regional sales offices can use the Internet, extranets, and other networks to transmit customer orders from their laptop or desktop PCs, thus breaking geographic barriers. Point-of-sale terminals and online sales transaction processing network can break time barriers by supporting immediate credit authorization and sales processing. Teleconferencing can be used to cut costs by reducing the need for expensive business trips since it allows customers, suppliers, and employees to participate in meeting and collaborate on joint projects. Finally, electronic data interchange systems are used by the business to establish strategic relationships with their customers and suppliers by making the exchange of electronic business documents fast, convenient, and tailored to the needs to the business partners involved.

Strategic Capabilities

EC Examples

Business Value

Overcome Geographic Barrier:

Capture information about business transactions from remote locations.Use the Internet and extranets to transmit customer orders from traveling salespeople to a corporate data center for order processing and inventory controlProvides better customer service by reducing delay in filling orders and improves cash flow by speeding up to the billing of customers.Overcome Time Barrier:

Information to remote locations immediately after it is requested.Credit authorization at the point of sale using online POS networkCredit inquiries can be made and answered in secondsOvercome Cost Barrier:

The cost of more traditional means of communication.Desktop videoconferencing between a company and its business partners using the Internet, intranets, and extranets.Reduce expensive business trips, allows customers, suppliers, and employees to collaborate, thus improving the quality of decision reached.Overcome Structural Barrier:

Support linkages for competitive advantageElectronic data interchange (EDI) of transactions data to and from suppliers and customers using extranets or other networks.Fast, convenient service locks in customers and suppliers.

Examples of the business value of electronic commerce applications of telecommunications.


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