Asynchronous Transfer Mode (ATM) is a network technology based on transferring data in what is referred to as ‘cells’ or ‘packets.’ These packets are usually of a pre-determined and fixed size. The packet used with ATM is relatively small when compared to units used with some older versions of the technology.

These smaller, more simplified packets enable ATM technologies to transmit video, audio, and computer data throughout the same older network. They also are designed to prevent any one specific type of data from hogging the network lines. Many users believe that ATM is the solution to the Internet bandwidth problem, however, many skeptics remain.

ATM basically establishes a fixed channel, or ‘route,’ that exists between two fixed points wherever a data transfer begins. This is different from TCP/IP, which divides messages into packets that all take different routing paths from the sender to the receiver.

This huge difference allows for better tracking and management of packets of data. This is capitalized on by companies that operate by the transmission of sensitive data such as bill data usage throughout an ATM network.

However, the down side is that it makes the network less able to handle sudden network traffic surges. The asynchronous aspect is referring to the nature of the data as being sent intermittently.

This works much like a telephone conversation where both parties may speak at the same time. Synchronous streaming is essentially one way and the transfer must be complete before the next stage may then occur.