Abstract: A highly efficient and modular communication network includes a small number of different exchange units including a network controller exchange unit, line master exchange units, line exchange units and terminal exchange units. For high volume, low cost manufacture and ease of maintenance, the exchange units are in turn comprised of a few standard modules such as a microprocessor unit, a RAM unit, a PROM unit and 2 port adapter units. A combination of high communication efficiency and rapid response is attained using small, address carrying data blocks which are threaded through one or more addressable micronodes along a communications channel. A predetermined communication discipline using fixed length blocks and a single start bit per block minimizes data block overhead to maintain a high communication efficiency notwithstanding the small data block size.