The invention is a novel method and apparatus for controlling the flow of traffic between a host digital terminal (HDT) and a plurality of optical network units (ONUs). Each ONU is connected to the HDT by
optical fiber and to a plurality of subscribers by a respective plurality of subscriber drops (typically pre-existing
copper twisted pairs). The bandwidth on the
fiber, although large, is usually inferior to the total bandwidth that can be transmitted across the subscriber drops. Therefore, both upstream and downstream traffic may become congested at various "
choke points" under certain circumstances of usage. Ordinarily, the data is buffered at the
choke points, leading to the installation of large queues within each ONU. This solution is not only expensive, but is inadequate since the required
queue size is dependent on the maximum transaction size, which has no hard upper bound. In contrast, the present invention provides a traffic shaper located in the HDT, which gives centralized control of the traffic flowing to and from the ONUs. Consideration of the priority and destination of each traffic
cell is taken into account by the traffic shaper to ensure that the capacity of the
fiber and of the individual drops is never exceeded, irrespective of the transaction sizes, thereby eliminating the need for costly buffers in the
outside plant. Any maintenance or repairs of the traffic shaper can be easily effected without field visits, due to its centralized location.