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The speed of any type of digital data transmission can be measured in baud. However this unit is usually applied only to serial communication channels carried via a single line (thus can only have one state at each point in time). While this unit is not usually applied to parallel communication channels carried via multiple lines (thus can have a different state on each of these lines at each point in time, making the actual baud rate of the channel the number of lines multiplied by the baud rate of one line).

Baud = state changes per second. Not bits per second!!

An example is the telephone modem. Because the bandwidth of a telephone signal is limited to 3KHz, the maximum possible speed is 2400 baud. However much higher bit per second rates are possible by using very complicated states (e.g. different signal amplitudes, different signal phases) and sometimes data compression algorithms.

For example with 4 different amplitudes and 4 different phases that can be used to represent a state, 16 different states (4 bits) can be transmitted for each baud. This would allow a telephone modem (limited to 2400 baud by the bandwidth limitation of the telephone line) to transmit 9600 bits per second.

For example with 8 different amplitudes and 8 different phases that can be used to represent a state, 256 different states (8 bits, 1 byte) can be transmitted for each baud. This would allow a telephone modem (limited to 2400 baud by the bandwidth limitation of the telephone line) to transmit 19200 bits per second.

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