Communication by means of a telecommunication system that is designed to transmit speech or sometimes data. A complete telephone system contains all the circuits, switching apparatus, and other equipment necessary to establish a communication channel between any two users connected to the main system. Communication between two points takes place along suitable cables (telephone lines) except where this is inappropriate; a particular access point may then be connected to the main system by means of a radio link (radio telephone), as in ship-to-shore telephony. See also cellular communications.

A telephone set is an assembly of apparatus that includes a suitable handset containing the transmitter and receiver, and usually a switch hook and the immediately associated wiring. A telephone set connected to a telephone system is a telephone station; one that has access to the public telephone network is a subscriber station. It is mainly large organizations that have a private exchange to interconnect telephone stations. Usually such an exchange is also connected to the public telephone system and is known as a private branch exchange: it is either a PABX (private automatic branch exchange) or PMBX (private manual branch exchange).

The public telephone system is organized in such a way as to facilitate the establishment of telephone channels. It consists of a large number of local exchanges that are switching stations where subscribers’ lines terminate and where facilities exist for interconnection of local lines or for connection to the trunk (long-distance) network. Local exchanges are treated in a similar way to subscribers and are connected together through higher-order switching stations, termed tandem exchanges. These in turn are interconnected by means of toll centres, each serving a city, then group centres and zone centres so that a large region, such as the UK, is served economically. Usually connection is made automatically by suitable switching networks that are actuated by signals from the caller’s telephone station. In the trunk network a system of repeaters is used that include one or more amplifiers to prevent loss of signal strength.

Communication between points in a telephone system may be made by means of a modulated carrier wave. If the carrier wave is suppressed when no audiofrequency signals are present the system is quiescent-carrier telephony. Voice-frequency telephony is also used. In the public telephone system voice-frequency telephony is employed for local connections between two lines in the same local exchange and carrier telephony for the trunk system. Multiplex operation allows the same telephone line to be used by several channels simultaneously.

The public telephone system is also used for electronic data transmission, such as electronic mail, telex, and fax. The data is transmitted in digital form using pulse code modulation. The telephone system is currently being converted to operate on a totally digital system. Analogue-to-digital converters are required to convert the analogue signals from telephones into digital form for transmission.