The modulated signal is transmitted over the channel and all users can receive it but only the user which knows the correct code can decode the message. This is depicted in the figure below.
[[Image:cdma14.jpg|thumb|600px|center|CDMA Demodulation]]
* CDMA's spread spectrum technique overlaps every transmission on the same carrier frequency by assigning a unique code to each conversation.
* The signal is spread at two levels first using a Walsh Code and then using a PN Code. The number of bits in either of the two codes is known as the "chip rate," and each bit in the spreading signal is called a "chip". One bit from each conversation (baseband signal)is multiplied with the walsh code and then the PN code by the spreading techniques, giving the receiving side an enormous amount of data it can average just to determine the value of one bit.
* Base station is the one that assigns spreading code to each call when a mobile requests for a call (unique Walsh code for each conversation and a same PN code for each call in a cell sector). In the analysis henceforth we discuss the dynamic allocation of these spread codes in accordance with the required QoS.
=== Frequency Reuse ===