In the next few years, more and more traffic will crowd the nation's information highways. Hospitals will transmit X-ray images to specialists hundreds of miles away, students will tap into distant research libraries, and executives will log into computer networks from home. But for this to happen on a grand scale, faster data communications are needed. Although fiber-optics will be a huge improvement, it will be decades before U.S. homes and businesses are fully connected.

Researchers at WavePhore Inc., a Phoenix startup, have developed a way to ease the bottleneck: a method for sending data on TV signals. At the transmission end, a $15,000 encoder compresses video data and inserts it into the TV signal. Then, with a $3,000 decoder, anyone who receives the signal--either through the airwaves or cable--can read the data. Within a year, predicts Charles Jungo, WavePhore's director of engineering, the system's speed--384,000 bits per second--will be increased to 1.5 million bits per second. Company executives envision myriad uses, such as doubling the number of movies a cable company can offer and bringing CD-ROM libraries and local-area networks to the home. "What we've done is to open up broad-band communications at low cost," says Jungo.

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