In a method of analyzing an optical communications signal, a threshold is
established under control of a processor, and a decision circuit compares
the amplitude of the signal to the threshold. A counter samples the
output of the decision circuit and counts, over many periods of the
signal, those samples indicating that the amplitude of the signal is
above the threshold. The threshold generating, comparing, and counting
are repeated for several thresholds within a range corresponding to an
expected amplitude range of the signal. The stored counts and thresholds
represent an amplitude histogram N(V.sub.T) for the signal. The
derivative dN/dV.sub.T of the function N(V.sub.T) represents the
probability density function (PDF) for the signal amplitude and can be
used to derive performance information such as bit error rate and optical
signal-to-noise ratio (OSNR).