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The authors experimentally demonstrate a novel optical Physical-layer Network Coding (PNC) scheme over Time-Division Multiplexing (TDM) Passive Optical Network (PON). Full-duplex error-free communications between optical network units (ONUs) at 2.5 Gb/s are shown for all-optical Virtual Private Network (VPN) applications. Compared to the conventional half-duplex communications set-up, their scheme can increase the capacity by 100% with power penalty smaller than 3 dB. Synchronization of ONUs is not required for the proposed VPN scheme. Time-Division Multiplexing (TDM) Passive Optical Network (PON), like E-PON or G-PON, has been widely deployed for delivering access services due to its low cost and broadcast capability. Conventionally, two Optical Network Units (ONUs) in the same PON cannot communicate with each other directly.
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