This paper proposes a novel universal line termination scheme for the ONUs (optical network units) of fiber-optic local access systems. Its main feature is that only low cost AD/DA converters for Hi-Fi audio are needed. Because audio AD/DA converters are insufficient for ISDN basic rate access (● 320kbaud) and cause waveform distortion, we develop a simple detection algorithm that does not use any equalizing filter. The algorithm can handle plural channels with one general purpose MPU (micro-processing unit). Based on this, a novel architecture for a fiber-optic local access system is presented that removes the MPUs from each optical network unit (ONU) and places them in the central office (CO). The proposed system yields a small, service-uniform ONU that supports a wide range of narrow-band services (POTS & ISDN) with no distinction. To realize this system at the lowest possible cost, a high-speed code division multiplexing (CDM) scheme with novel code word sets is developed.