In external modulation, an external device is incorporated to modulate the intensity or phase of the light source. Figure 1: Laser diode used for direct modulation. In direct modulation, the output power of the device is directly dependent on the input. What is an Optical Transceiver and what is its primary function? An optical transceiver is a modular device that serves as both a transmitter and a receiver (hence the name). Its primary function is to achieve optoelectronic conversion by converting electrical signals into optical signals and vice versa. The inverse process that recovers the encoded information from the modulated optical wave is called demodulation.
