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A basic property of single mode optical fiber is its enormous low-loss bandwidth of several tens of Terahertz. However, due to dispersive effects and limitations in optical device technology, single channel transmission is limited to only a small fraction of the fiber capacity. To take full advantage of the potential of fiber, the use of Wavelength Division Multiplexing (WDM) technology has become the option of choice. With WDM, a number of distinct wavelengths are used to implement separate channels. An optical fiber can carry several channels in parallel, each on a particular wavelength.
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