It has two states, either off hook or on hook. This signaling is primarily used between PBX's on tie trunks and central offices that are using in-band signaling. All of these functions, incorporated with some alarm reporting, constitute what is known as a channel bank. Size can range from a large jewelry box piece of equipment to refrigerator sized. Prices of a channel bank depend on what functionality and signaling is required to support the end user.
Complete systems can run from several thousand dollars on up.
There are also refurbished channel banks available, many of which have come out of central office environments. Users can save quite a bit of money by using refurbished gear, which is generally very reliable. The intelligent ones cost more, of course. All types of data can be run through channel banks with the proper channel and interface cards. As technology continues to change, the functionality of channel bank equipment will increase while the size will get smaller and the price will continue to drop.