We address the use of optical parametric oscillator (OPO) to counteract phase-noise in quantum optical communication channels, and demonstrate reduction of phase diffusion for coherent signals travelling through a suitably tuned OPO. In particular, we theoretically and experimentally show that there is a threshold value on the phase-noise, above which OPO can be exploited to squeeze phase noise. The threshold depends on the energy of the input coherent state, and on the relevant parameters of the OPO, i.e. gain and input/output and crystal loss rates.
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