30 CHAPTER 2 / TRANSMISSION FUNDAMENTALS ‘The signal-to-noise ratio is important in the transmission of digital data because it sets the upper bound on the achievable data rate. Shannon’s result is that the maximum channel capacity, in bits per second, obeys the equation C = Blogs(1 + SNR) where C is the capacity of the channel in bits per second and B is the bandwidth of the channel in Hertz. The Shannon formula represents the theoretical maximum, that can be achieved. In practice, however, only much lower rates are achieved. One reason for this is that the formula assumes white noise (thermal noise). Impulse noise is not accounted for, nor are attenuation distortion or delay distortion. Various types of noise and distortion are discussed in Chapter 5. ‘The capacity indicated in the preceding equation is referred to as the error-free capacity. Shannon proved that if the actual information rate on a channel is less than the error-free capacity, then it is theoretically possible to use a suitable signal code to achieve error-free transmission through the channel. Shannon’s theorem unfortu- nately does not suggest a means for finding such codes, but it does provide a yardstick by which the performance of practical communication schemes may be measured. Several other observations concerning the preceding equation may be instruc- tive. For a given level of noise, it would appear that the data rate could be increased by increasing either signal strength or bandwidth. However, as the signal strength increases, so do the effects of nonlinearities in the system, leading to an increase in intermodulation noise. Note also that, because noise is assumed to be white, the wider the bandwidth, the more noise is admitted to the system. Thus, as B increases, SNR decreases, Example 2.1 Let us consider an example that relates the Nyquist and Shannon for- rullations Suppose that the spectrum of a channel is between 3 MHz and 4 MHz and SNRgq = 2448. Then B= 4 MHz ~ 3 MHz = 1 MHz SNR = 24 dB = 10 logio(SNR) SNR = 251 Using Shannon's formula, C= 10° x loga(1 + 251) 10° X 8 = 8 Mbps This isa theoretical limit and, as we have said, is unlikely to be reached. But assume we can achieve the limit. Based on Nyquist’s formula, how many signaling levels are required? We have C= 2B log, M 8X 108 = 2 x (10%) x logy M 4 = log M M=16