In an optical data transmission system, one channel is removed from a group of wavelength division multiplexed optical channels and another channel carrying different information at the same wavelength is inserted in its place. The process occurs by adding an optical signal whose electric field is the difference between the electric field of the new and old channels. The difference calculation takes into account the phase of the incoming WDM channel and phase of the laser source of the difference signal. The method has applications in optical transmission networks as add-drop nodes and optical regenerators, for generation of high bandwidth optical signals, and for secret optical communications.