Abstract-The effect of the companding process on QAM signals has been under investigation for the past several years. The compander, included in the PCM telephone network to improve voice performance, has an unusual affect on digital QAM data signals which are transmitted over the same channel. The quantization noise, generated by the companding process which is multiplicative (and asymmetric), degrades the detectability performance of the outermost points of the QAM constellation more than that of the inner points. The combined effect of the companding noise and the inherent white gaussian noise of the system, leads us to a re-examination of signal constellation design. In this paper we investigate the detectability performance of a number of candidates for signal constellations including, a typical rectangular QAM constellation, the same constellation with the addition of a smear-desmear operation, and two new improved QAM constellation designs with two-dimensional warpi

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