What is the difference between Multimode and single mode step index fiber ?

Multimode fiber is normally driven by an LED. The light is somewhat focused but bounces all around off the walls of the fiber. Different parts of the beam will travel different distances, such that what started out as a nice square wave pulse will get all smeared out after some distance and harder to detect. Both the fiber and the transmitters/detectors are cheap.

 Single mode fibers are driven by a laser. A laser beam is “coherent”, meaning all parts of the beam are pointing in exactly the same direction. Thus a nice pulse can travel huge distances and still look good, even if the fiber bends. In fact, a single mode fiber has been used to transmit a signal clear across the US without repeaters. This stuff is lots more expensive and is only therefore only used for long hauls.

 In addition, single mode fiber can carry multiple beams of different colors at the same time. The technique for doing this is a very inexpensive prism at each end. This is called Wave Length Division Multiplexing (WDM) and a single fiber can be used to carry multiple transmissions at one time. Last time I checked they were up to 128 channels at one time - explaining why long distance calls are basically free now.