Amplitude
In an amplitude modulation system, or AM, the low-frequency modulating signal changes the peak height, or amplitude, of the high-frequency carrier wave. The circuits for amplitude modulation and demodulation are relatively simple and straightforward; the first commercial radio broadcasts used AM in the 1920s. These transmissions pick up noise easily, however -- stray radio interference and lightning strikes show up in the demodulated audio signal as crackles and static.
Frequency
Frequency modulation or FM involves slight frequency shifts of a carrier wave in proportion to the modulating signal. As the wave of a modulating signal hits a positive peak, the carrier wave increases in frequency; when it reaches a negative peak, the carrier frequency decreases. Modulation and demodulation equipment for FM have traditionally been more complex than AM, though modern electronics implement FM in a single integrated circuit component. Unlike AM, FM is much less prone to noise.
Frequency-Shift Keying
Unlike analog signals, which involve a continuous range of signal voltages, digital signals consist of two voltage states, representing binary ones and zeroes. Frequency-shift keying, or FSK, is a specialized form of frequency modulation used to encode digital signals for computer data. An FSK system has a carrier at one of two frequencies, one representing a binary zero and the other representing a binary one. A single signal path can have two carrier signals, one for sending data, another for receiving data. Each carrier has a pair of distinct, non-overlapping frequencies. This scheme, called full duplex, sends and receives data at the same time.
Pulse Code
Pulse Code Modulation, or PCM, is a technique whereby a circuit encodes an analog signal into a digital data stream, and another decodes it back into analog. In this system, an analog-to-digital converter circuit samples an analog signal thousands of times per second, producing numeric data representing the changing voltage values of the original signal. Once converted to digital data, you can easily store, copy or transmit it using computers or optical discs. A digital-to-analog converter recovers the original signal from the data.