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An optical coherent transmission and distribution system using subcarrier multiplexing (SCM) techniques is proposed in which the local LD is set in the transmitter and the signal and local light are mixed before transmission. The feasibility of the system was experimentally confirmed, using three-electrode DFB-LDs, with an optical FM by two-channel 560 Mbit/s ASK-SCM signal and heterodyne transmission through 25.7 km of single mode fibre. This system was insensitive to the state of polarisation in the transmission fibre. It was shown that more than 1000 subscribers could be served with Er3+-doped fibre amplifiers.