urther in a later section of the chapter. In RZ and NRZ modulation, the bandwidth of a pulse stream is proportional to its bitrate. This means that, in the absence of any adjustment to the output power from the transmitter, the power spectral density of a channel (W/Hz) varies inversely with its bitrate. However, operation at the same BER requires that the power spectral density be maintained at the receiver. Therefore, for higher-bitrate operation we need a transmitter that provides higher-power pulses and/or we need to increase the inline amplification (Kartalopoulos, 2004). As a concrete example, if all else is equal and we upgrade operation from 2.5 Gbit/s to 10 Gbit/s, the average optical channel power incident on the receiver must be raised by a factor of 4 (i.e., 6 dB). Normally high-datarate systems require both higher launched powers and the maintenance of channel powers through appropriate amplification strate- gies. Both of these become increasingly demanding at very high bitrates. Later in the chapter we describe some of the problems that can occur when the average optical power in the fiber is too high. Optical Transmitters The lasers that provide the optical pulses are semiconductor based (Liu, 2005), and they can be driven by the direct injection of electrical current. Operation in this manner is simple and low cost and is commonly used for short-span and lower-bitrate applications, such as Local- Area Networks (LANs) and access networks. However, the pulses that emerge from directly modulated lasers have a positive "chirp," which means that their wavelength changes during the lifetime of the pulse. Unfortunately, positively chirped pulses become greatly broadened in the time domain when they are guided by fibers with positive chromatic dispersion (see the later relevant section). After propagating over a sufficient distance they spread into neighboring bitslots, making it impossible for the receiver at the end of the system to interpret the bits reliably (Wilner & Hoanca, 2002). The problem of pos