Apart from the DOMSAT program, Telikom commenced in 1994, a five year program of moderning its telephone exchanges from analogue (mechanical) to digital (computerised).

The first system 12 digital exchange was put into service in Lae in April 1993, which was followed by Kimbe and Boroko. At the end of 1995, the following centres had the System 12 digital exchanges installed. Alotau, Bomana, Boroko, Bubia, Bwagaoia, Daru, Lae, Lorengau, Madang, Mt Hagen, Tabubil, Toamvatur (Rabaul), Waigani and Wewak.

The Public Switched Telephone Network (PSTN) is now predominantly digital. Alcatel System 12 and Telrad/Nortel DMS series of digital exchanges are now installed at all urban and major population centres throughout the country. Small stand-alone digital exchanges, remote switching unties and digital line concentrators are also installed at most of the smaller remote centres.

These exchanges have been designed to provide customer with quality improved point to point connections, faster setting up of calls, reduced exchange congestion, reduction in maintenance costs and time, faster connections and service transfer. They also provide distinctive customer features. In addition to the direct exchange line services, it will offer Call Waiting, Call Control, Call Forwarding, Itemised Billing, Ring Back price information (on STD/ISD Calls), Wake Up Calls, Inquiry Calls, Multi-party conferencing and abbreviated dialing.