Eye diagrams are important tools in telecommunications for analyzing the performance of digital signals, such as noise, distortion, and intersymbol interference. This FAQ compares the non-return-to-zero (NRZ) and pulse modulation (PAM) formats, which are common ways of reading an eye diagram.
NRZ represents binary data using two voltage levels, 0 and 1. This results in a straightforward representation on the eye diagram, where the signal alternates between these two levels without returning to zero during the bit period. As NRZ uses two distinct voltage levels, it is the same as PAM2, where “2” represents the two levels of the binary data representation.
When three or more levels are used in an eye diagram, then the format can be PAM3, PAM4, and so on, depending on the number of levels. For example, PAM4 uses four distinct levels to encode data. This results in more complex eye diagrams with multiple openings corresponding to different voltage levels, as shown in Figure 1.

The eye diagram for NRZ/PAM2 features a wide and clearly defined eye opening. This indicates good signal integrity, as a larger eye opening suggests minimal distortion and noise interference. The eye diagram for PAM4 is generally narrower compared to NRZ/PAM2. As the number of levels increases, the amplitude difference between each level decreases, leading to a smaller eye opening. This can make PAM4 signals more susceptible to noise and distortion.
Transitions between levels in an NRZ/PAM2 signal are smooth, contributing to a more open eye pattern. This allows for easier timing recovery and better overall performance in terms of error rates. In PAM4 signaling, transitions occur between multiple voltage levels, complicating the timing recovery process. The presence of several distinct levels can lead to a more intricate eye pattern with potential overlaps and closures that indicate increased intersymbol interference.
The main advantage of PAM4 over NRZ/PAM2 is its bandwidth efficiency. PAM4 encodes two bits of information per symbol, while NRZ/PAM2 encodes only one bit per symbol. This means that PAM4 can double the data throughput for the same baud rate compared to NRZ/PAM2. For example, a PAM4 signal operating at 28 GBaud can transmit 56 Gbps, whereas an NRZ/PAM2 signal at the same baud rate would transmit only 28 Gbps.
By increasing data density and reducing the number of required transceivers and associated infrastructure (like cables and connectors), PAM4 can lower overall system costs for high-speed applications. Figure 2 summarizes the differences in technical specifications of PAM4 and NRZ/PAM2 formats, and the transition states that PAM4 and NRZ/PAM2 can be achieved during signal transmission.

Figure 3 illustrates the relationship between symbol rate (Gsym/s/lane) and data rate (Gbps/lane) for different signaling schemes, such as NRZ/PAM2, PAM3, PAM4, PAM8, and PAM16. It also categorizes technology trends and limitations for high-speed serial communication interfaces, such as Thunderbolt, USB, DisplayPort, HDMI, PCI-Express, MIPI, and IEEE 802.3 (Ethernet).

It can be observed from the chart that all these technologies have been historically reliant on NRZ/PAM2. However, NRZ/PAM2 is reaching its practical limits of 100 Gbps/Lane, prompting a shift to higher-order modulations like PAM4. Therefore, IEEE 802.3 and PCI-Express are moving towards PAM4 signaling, reducing the required symbol rate for a given data rate. Future technologies (PAM8/PAM16) are still being researched and are not widely adopted due to implementation challenges.
Figure 4 shows the benefits of PCI-Express” transition to PAM4 with its PCIe 6.0 version. While the data rate has doubled to 64 GT/s from 32 GT/s, the nominal channel loss has decreased by 4 dB, indicating improved signal transmission efficiency.

The three-tap DFE of PCIe 5.0 can cancel ISI from up to three previous symbols. This suits the data rates and channel conditions specified for PCIe 5.0. Introducing a 16-tap DFE in PCIe 6.0 allows for a more sophisticated equalization process, enabling the system to account for ISI from more previous symbols.
Summary
The electronics industry is increasingly shifting from NRZ/PAM2 to PAM4 format due to several factors related to data transfer capacity, efficiency, and the evolving demands of high-speed communications. As traffic increases, especially with the rise of 400G Ethernet, PAM4 has become the preferred modulation technique for long-haul and medium-haul connections over fiber optics. However, the increased susceptibility to noise due to the tighter spacing of signal levels means that PAM4 requires advanced equalization techniques and more sophisticated transceiver designs.
References
PAM4 Signaling in High-Speed Serial Technology: Test, Analysis, and Debug, Tektronics
How PAM4 Signaling is Changing PCIe 6.0 Jitter Measurements, Teledyne LeCroy
Comprehensive Eye Diagram Analysis: A Transfer Learning Approach, IEEE
PAM4 Modulation & PAM4 vs NRZ, How Much Do You Know?, QSFPTEK
PAM4 vs NRZ: What You Need to Know, EDGE Optical Solutions
What is PAMx (x=2,3,4…) Signaling Technology?, I-PEX Inc.
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