Laser diodes have complex circuits and hence expensive. Such expensive light sources are reasonable to use in long haul transmission since the cost can be justified with the performance. Moderate frequency analog transmission for example that used in catv application runs a few kilometers compared to the long haul applications. Light emitting diodes gives out incoherent output light that is capable of traveling a few kilometers before it gets dispersed and attenuated.
Laser diodes give out coherent output light that can travel long distances. Laser diodes are expensive, but can support transmission at 1550 nm wavelength for long distance.
Transmission distances that can be achieved with LEDs are enough for moderate frequency analog applications. Since LEDs are cheaper, they are preferable in such applications.
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