What Is Data Communication? Components & Benefits

7 min read

Our modern world of connectivity would not be possible without data communication. It’s the bedrock by which our devices are able to communicate with each other, which also has provided us with an unprecedented level of instant, convenient access to information.

However, the innovations we’ve seen in the last 50 years since the development of the first wireless networks and the creation of the Internet are just the tip of the iceberg. The possible technologies we could be seeing within the next few years is fertile ground for those looking to create new business models, which is a major driving factor of why we’ve developed the Master of Science in Innovation, Technology and Entrepreneurship degree program.

Before we go into detail about what may be on the horizon, it’s important to take a step back to understand the basic models of data communication and its general benefits. These insights will provide some helpful context on where we might be headed, and maybe inspire you to develop the next great innovation in data communication.

What Is Data Communication?

Data communication is functionally similar to what we think of as “regular” communication, which is simply a sender transmitting a message to a destination. Data communication specifically refers to the process of using computing and communication technologies to transfer data (the message) from a sender to a receiver — or even back and forth between participating parties. The concept encompasses technologies like telecommunications, computer networking and radio/satellite communication.

Modern data networks all provide the same basic functions of transferring data from sender to receiver, but each network can use different network hardware and software to achieve these ends. Communication between devices adheres to industrial communications protocols, which is the set of rules that define how data is exchanged. Today’s data communications protocols are defined and are managed by interconnected bodies, including private businesses, standards-making organizations, regulatory agencies and common carriers.

Benefits of Data Communication

Before we can get into the benefits of data communication, it’s important to separate the concept of connectivity from communications. Connectivity is the capability of connecting one party to another. The benefits that arise from those connections depend on who’s connecting to whom — or to what.

We can think of it along three types of connections:

  • Person to Person — such as when you call someone on a cell phone or have a chat session.
  • Person to Machine — whenever you access information from a computer or automated system.
  • Machine to Machine — when devices transfer information directly between each other.

Rather than being confined to these simple interactions, you can think of connectivity as a continuum. For example, when you text with someone else, the following steps occur:

  1. A person connects to a machine to send a message.
  2. The machine connects to another machine to deliver the message.
  3. The second machine translates and displays the message to another person.
  4. That person responds, and the process repeats, enabling a person-to-person connection.

The one thing that remains true in all of these connections is that some kind of information is transmitted, whether it’s retrieving a report from an archive, uploading data to a cloud server or holding a meeting in a Zoom call. Here’s a video that talks about the basics of connectivity in a little more detail.

Now, when we talk about data communications and networking, what we’re usually talking about are specific platforms. A data communications platform is essentially any technology that — whether it’s a cellphone, a laptop or the internet itself — enables connectivity. Today, data communication has become as ubiquitous as electricity itself, which has brought some incredible advances:

Instant communications. All of our modern digital communications, from email and instant messaging to video calls and TikTok, are all built on data communication networks. You can instantly connect with anyone in the world — or broadcast a message to thousands of people.

Greater business efficiency. Data communications has revolutionized how businesses interact with data. More effective ways of collecting and processing data leads to greater insights, which allow businesses to streamline productions, reduce expenses and improve operational efficiencies.

Innovations in automation. The Internet of Things (IoT) enables even more connection between different devices, allowing for new types of automation. For example, when we think of self-driving cars, providing them the ability to directly connect with other cars on the road over a 5G network makes the concept much more workable than trying to rely entirely on cameras and other sensors to determine positioning.

Smart monitoring systems. Sensors in wearable devices allow for advanced human health monitoring, which can transmit real-time data on someone’s condition or send alerts in an emergency. Wider applications include the development of smart cities that can offer improved traffic conditions, waste management, energy consumption and more.

Components of Data Communication

There are several components of data communication, but to keep things relatively brief, we should look at three of the most important elements: communication functionality, network models and standards of communication.

Communication functionality

We’ve talked about the nature of communications being between sender and receiver. As data platforms advanced, there came increased functionality in how sender and receiver were able to communicate.

  • Simplex communications, which were the first and simplest means of communication where the transmission of data goes only in one direction. Simplex is still used in one-way data communications mediums such as radio stations and TV broadcasts.
  • Half-duplex communication, where information can go both ways but not at the same time. An example would be a CB radio, where a receiver has to wait for the system to be clear before responding.
  • Full-duplex data communications models accommodate simultaneous two-way communication of data. The landline telephone is the most widely known means of full-duplex communication.
  • Serial data communications is what we think of when we talk about networking. Data is packaged into units and then sent serially to the receiver by the sender. Once it is received, the units are reassembled to recreate the original data.

Network models

Serial data communications relies upon networks to transmit data. The two most important network models are the Open Systems Interconnection Reference (OSI) model and the Internet model:

  • The Open Systems Interconnection Reference model was developed by the Open System Interconnection Subcommittee in 1984. The OSI model consists of seven layers: the physical layer, data link layer, network layer, transport layer, session layer, presentation layer and application layer. Though it isn’t widely used today, it still has value as a foundational understanding of networking.
  • The Internet model, though actually older than OSI, is the network model that has arisen to be the dominant model for all current hardware and software. Also referred to as the Transfer Control Protocol/Internet Protocol (TCP/IP) model, it combines the top three OSI layers into a single layer, making it a five layer model consisting of a physical layer, data link layer, network layer, transport layer and application layer. The Internet model allows different independent networks to connect one another and then together, create what we know as the global Internet.

Standards of Communication

Standards define a set of rules known as protocols, which ensure that the software used in the different layers of the network models are compatible. Without standards, it would be virtually impossible for computers to communicate between each other. With standards, any hardware and software that conforms can communicate with any other hardware and software that conforms to that same standard.

Previously, standards of communications were set by telecommunications standards bodies specific to different countries. Today, the Third Generation Partner Project (3GPP) initiative brings together more than 80 countries to establish a converging set of standards to establish and maintain the global communications network.

There are other elements that comprise data communication, such as protocols and communication channels. All of these fundamentals are covered in MITE’s Introduction to Communications pre-requisite class, which serves as a data communication and networking tutorial, including the different OSI layers, the different standards committees and how data communication is globalized.

Future of Data Communication

The capabilities we currently have with data communication are revolutionary, which is why we define the modern era as “the information age.” The advances we’ve experienced can make it harder to predict where and how data communications and networking might continue to develop. That said, here are some considerations of what looks to be on the immediate horizon.

New applications of data communication networks. The evolving performance of wired and wireless communication networks — such as 5G and the IoT — are enabling new applications such as self-driving vehicles, mixed and augmented reality and advances in remote communication that allow for feats like remote surgery. Beyond these more “high-end” applications, the growth of ever faster networks continues to make cloud computing more of a baseline technology for corporate computing networks. The continued adoption of the cloud should improve computer utilization efficiency for every industry.

More investment in developments that support green technologies. Digital platforms allow for greater efficiency and less reliance on certain resources, but they have to be constructed in a thoughtful and sustainable manner. For example, the development of smart electricity grids is necessary to aid in the electrification of transportation — such as the next generation of electric vehicles. This push for green and more efficient computing power will likely require the creation of adaptive logical “private networks,” more 2-way data communications networks and the utilization of AI to enable more efficient resource allocation.

Rising threat of international restrictions and bans on certain technologies. The trend over the last ten years in data communication has been to foster more international cooperation and a drive to set global standards. However, even as global networks integrate around common standards, certain geopolitical tensions indicate that we may be approaching a turning point where different regions limit or even ban access to certain communication technologies. Recent examples include how the US and EU banned the Chinese company Huawei from providing equipment to their networks and ongoing talks of a potential TikTok ban in the US.

Continued merging of communication networks with cloud computing. For businesses looking to complete a true digital transformation, the integration of telecommunication networks and the cloud will be the next step forward. These combined networks will be dynamically provisioned by software to solve business problems on much finer granularity than what we experience today. Advances and requirements will include:

  • The development of ultra wide band, low-latency networks capable of 10 Gigabits for real time applications such as drone fleet control, displays of mixed / augmented reality and interactions within the metaverse.
  • The development of a million Internet addresses per square kilometer to enable IoT and other applications even in remote locations.
  • The creation of nanonetworks where nanomachines are able to communicate with each other, allowing for hyper-localized communication monitoring and data collection.
  • AI algorithms that will assign value to data in order to keep things organized, an essential step as “big data” continues to grow exponentially.
  • The continued evolution of end-to-end network security measures to protect against data breaches and hacks.

We hear a lot about the smaller, every day developments that come with the implementation of new data communication platforms like 5G — such as faster cell phones and better service. In truth, those elements are quickly rolled out by telecommunication companies because they can be monetized easier. The real changes that come with rollouts like 5G are far more transformative.

For example, a merger between the telecommunications network and data networks, which would make the telecom network actually programmable, would allow all mobile phones access to wireless networks anywhere they have a phone network signal. With the full rollout of 5G — and the future of 6G — we can expect the incorporation of wired, wireless and even satellite communications into a single network, capable of integrating with Wi-Fi to enable entirely new applications.

If you’re looking to be a part of the innovation that is driving the next generation of data communication, you need the ability to look around the corners to see what’s possible. The reason why connectivity is a main focus of the MITE program is to understand what’s driving innovation and gain insights into what’s next on the horizon. If you’re interested in collaborating with others to develop the future of data communication to capitalize on the world of connectivity, we invite you to learn more about our program..