DWDMs allow for more flexibility in the design of networks

DWDM systems facilitate a wide variety of applications, some of which include broadcasters and cable operations, data networks, and satellite and wireless communications. Transponder based DWDM systems can be implemented as a replacement for any existing WDM systems if the advantage of doing so justifies the cost. If a company has already invested in laying down fiber, that initial investment can be protected by using such a DWDM system. Using this system multiplies the capacity of the existing fiber by up to 10 or more times. This type of system is necessary for internet providers because of the rapid expansion of internet subscribers. If DWDM systems did not exist, the only way for these companies to meet the demand of internet users would be to lay new fiber. It is much more cost-effective for them to implement tunable DWDM optics systems and thus alleviate the bandwidth concern. .

Research is advancing the technology to the point where 800 wavelengths on a single fiber could be feasible. The amount of data that modern applications require continues to grow. Where bit rates of a few Gbps were once sufficient, modern consumer and corporate needs necessitate Tbps. This type of growth could not have been anticipated when the first WDM systems were introduced, but the tranponder based DWDM systems are capable of meeting modern demands.

In their first incarnations, terminal demultiplexers were passive systems. As the complexity of DWDM systems increased, the need for an active approach did, too. Terminal demultiplexers take the signal, which is composed of several wavelengths by this point, and breaks it down to its constituent signals. These signals are then sent through individual fibers to their destinations. The active terminal demultiplexers first go through an output transponder before they are transmitted, which can also go through an error correction procedure. These transponders can also be placed a longside the input transponders.

Intermediate line repeaters are placed between 80 and 100 km apart along the path of the fiber. If the optical signal has travelled more than 140 km before arriving at its destination, an DWDM passive MUX is placed. It serves to not only amplify the signal, but also as a diagnostic point. If locations further down the path of the fiber are having issues with the signal, these sites can be used to determine if the fiber has been damaged or otherwise impaired.

Within the DWDM system a transponder converts the client optical signal from back to an electrical signal and performs the 3R functions. This electrical signal is then used to drive the WDM laser. Each transponder within the system converts its client's signal to a slightly different wavelength. The wavelengths from all of the transponders in the system are then optically multiplexed. In the receive direction of the DWDM system, the reverse process takes place. Individual wavelengths are filtered from the multiplexed fiber and fed to individual transponders, which convert the signal to electrical and drive a standard interface to the client. 

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Cisco compact DWDM MUX DEMUX