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Icom and Kenwood began their collaboration in 2003. The NXDN protocol was announced in 2005, and NXDN-compatible products first appeared in 2006.
The NXDN Common Air Interface (CAI) was accepted at the Study Group 5 (SG5) meeting of the International Telecommunication Union Radiocommunications Sector (ITU-R) held in November 2016 and in report M.2014-3 published in February 2017 as an international digital land mobile system.
The NXDN protocol and the communications products in which it is used are intended for commercial Private Land Mobile Radio (PLMR)  and public safety communications systems. The technology satisfies the U.S. Federal Communications Commission (FCC) mandate requiring all communications systems covered by Part 90 regulations to use narrowband technology by January 1, 2013. Part 90 regulations specify a bandwidth of 12.5 kHz, but the FCC “strongly urges licensees to consider migrating directly to 6.25 kHz technology rather than first adopting 12.5 kHz technology and later migrating to 6.25 kHz technology.” The FCC “will expeditiously establish a schedule for transition to 6.25 kHz narrowband technology.” 
NXDN uses Frequency-Division, Multiple-Access (FDMA) technology in which different communication streams are separated by frequency and run concurrently. Time-Division, Multiple-Access (TDMA) systems combine the communications streams into a single stream in which information from the different streams is transmitted in interleaved time allocations or "slots." Code-Division, Multiple-Access (CDMA) systems allow many users to share a common spectrum allocation by using spread-spectrum techniques.
The basic NXDN channel is digital and can be either 12.5 kHz or 6.25 kHz wide. 6.25 kHz dual-channel systems can be configured to fit within a 12.5 kHz channel. This effectively doubles the spectrum efficiency compared to an analog FM system occupying a 12.5 kHz channel. The architecture of NXDN is such that two NXDN channels, within a 12.5 kHz channel for example, can be allocated as voice/voice, voice/data, or data/data. As of 2012, this capability cannot be implemented in commercially available hardware on simplex or "talkaround" frequencies, but only through repeaters.
Systems that use NXDN also support mixed analog FM and digital NXDN equipment, including direct radio-to-radio communications. This allows system owners to migrate to a narrowband, digital system without replacing the entire system at once. NXDN equipment is currently FCC type-accepted for use on VHF (136-174 MHz) and UHF (400-520 MHz) bands.
Data is transmitted using 4-level frequency-shift keying (FSK) modulation. NXDN uses the AMBE+2 vocoder (codec) for digital audio. This combination provides better weak-signal voice quality than for analog FM. For an equivalent transmitter power, NXDN is represented as having a wider range and slightly better multi-path characteristics than analog FM in typical RF environments, specifically at the 12 dB SINAD threshold. The transmission bit rate is 4,800 bit/s.
- 8K30F1E 12.5 kHz single channel digital voice
- 8K30F1D 12.5 kHz single channel digital data
- 8K30F1W 12.5 kHz single channel digital voice and data
- 4K00F1E 6.25 kHz single channel digital voice
- 4K00F1D 6.25 kHz single channel digital data
- 4K00F1W 6.25 kHz single channel digital voice and data
- 4K00F2D 6.25 kHz single channel analog CW ID
The NXDN protocol provides support for the following functions. Implementation of the functions and the user-level interfaces by which they are accessed and used may vary by manufacturer.
- Encryption – Spectrum-inversion digital voice scrambling with a 15-bit key for 32,768 different codes
- Paging & Status Reporting – Radio-to-Radio and Dispatch-to-Radio
- User Aliases – 65,545 different Group IDs and User IDs
- Man-down and Emergency call
- Remote radio management functions - Stun/Kill/Revive and Monitor
- Over the Air Programming
- Over the Air Alias
- Interface to third party applications for; Paging to radio, GPS Location, Taxi Data Terminals, In Building tracking
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In all lossy compression schemes, trade-offs are made in voice reproduction quality in return for minimizing the raw bit rate of the transmission. This leads to artifacts and compromises of frequency response in reproduced speech. Encoders and other compression schemes that are highly optimized for speech are often unsuitable for non-speech audio, such as music or frequency-shift keyed data. Using an inappropriate encoder usually results in the creation of distortion and artifacts in the reproduced audio.
The audio reproduction quality of IDAS and NEXEDGE communications systems is dependent on the performance of the AMBE+2 voice codec used by NXDN. The AMBE family of vocoders has been subjected to comparative testing and found to be adequate for its intended uses, primarily mobile and aeronautical radio. The AMBE+2 vocoder has also been selected for use in the Motorola MOTOTRBO radio family and the Project 25 (P25) mobile radio system. The following reports and papers are descriptions of laboratory-environment evaluations of AMBE+2 and other speech vocoders.
Compromises in audio quality are inherent in the use of any codebook-based speech coder, particularly when used in conditions of high background noise. Incremental improvements are being made in the algorithms, which may lead to differences in performance even while the basic method remains unchanged. In the US, the Department of Commerce Public Safety Communications Research laboratory regularly reports on progress in this field. While their work specifically pertains to Project 25 radios, it is directly applicable to any system using similar multi-band excitation coders.
The NXDN Forum was formed in order to promote the NXDN protocol in North and South America. The forum's members are:
- Aeroflex Wichita, Inc.
- Anritsu Corporation
- Avtec, Inc.
- CML Microcircuits
- Daniels Electronics, Ltd.
- Icom Incorporated
- Kenwood Corporation
- Ritron, Inc.
- Trident Micro Systems which was bought by Motorola Solutions in December 2014.
- Hytera Communications
- Freedom Communication Technology
- "The history of NXDN™". NXDN-Forum. Retrieved May 21, 2016.
- "Voice Quality Assessment of Vocoders in Tandem Configuration" (PDF). NTIA Report 01-386.
- Campos Neto, S.F. (1996). "Performance assessment of 4.8 kbit/s AMBE coding under aeronautical environmental conditions". IEEE International Conference on Acoustics, Speech, and Signal Processing, 1996. ICASSP-96 Vol 1. Conference Proceedings. doi:10.1109/ICASSP.1996.541142.
- "Project 25 Vocoder Evaluation Mean Opinion Score Test". TIA TSB-102.BABE.
- "Welcome to the PSCR Program".