An optical transceiver for an optical communications network, comprising: a receiver configured to receive an optical signal comprising an X-polarization component that comprises a first frame and a Y-polarization component that comprises a second frame, each of the frames comprising a plurality of training sequences; a processor coupled to the receiver and comprising a channel estimation unit, the channel estimation unit comprising a data path (528, 530) for each of the polarization components, each data path comprising a plurality of FFT modules (502, 504, 506, 508) adapted to receive a respective plurality of training sequences, a vector module (510, 512) adapted to combine the outputs of the FFT modules, means (522, 518, 524, 520) for providing a training matrix determined according to frequency domain representations of the training sequences of the optical signal, an estimated phase of the training sequences and a chromatic dispersion compensation value received by the channel estimation unit, and a matrix vector multiply module (514, 516) adapted to multiply the output of the vector module by the training matrix; the channel estimation unit further comprising a channel estimate module adapted to combine the outputs of the vector multiply modules to form a channel estimate according to the training sequences of the optical signal, the processor being configured to: determine a chromatic dispersion and PMD compensated optical signal according to the channel estimate; and a transmitter coupled to the processor and configured to transmit the compensated optical signal to a downstream component in the optical communications network. a receiver configured to receive an optical signal comprising an X-polarization component that comprises a first frame and a Y-polarization component that comprises a second frame, each of the frames comprising a plurality of training sequences; a processor coupled to the receiver and comprising a channel estimation unit, the channel estimation unit comprising a data path (528, 530) for each of the polarization components, each data path comprising a plurality of FFT modules (502, 504, 506, 508) adapted to receive a respective plurality of training sequences, a vector module (510, 512) adapted to combine the outputs of the FFT modules, means (522, 518, 524, 520) for providing a training matrix determined according to frequency domain representations of the training sequences of the optical signal, an estimated phase of the training sequences and a chromatic dispersion compensation value received by the channel estimation unit, and a matrix vector multiply module (514, 516) adapted to multiply the output of the vector module by the training matrix; the channel estimation unit further comprising a channel estimate module adapted to combine the outputs of the vector multiply modules to form a channel estimate according to the training sequences of the optical signal, the processor being configured to: determine a chromatic dispersion and PMD compensated optical signal according to the channel estimate; and a transmitter coupled to the processor and configured to transmit the compensated optical signal to a downstream component in the optical communications network.