PPM Vs. M-FSK
PPM and M-FSK systems with the same bandwidth, average power, and transmission rate of M/T bits per second have identical performance in an AWGN (Additive White Gaussian Noise) channel. However, their performance differs greatly when comparing frequency-selective and frequency-flat fading channels. Whereas frequency-selective fading produces echoes that are highly disruptive for any of the M time-shifts used to encode PPM data, it selectively disrupts only some of the M possible frequency-shifts used to encode data for M-FSK. On the other hand, frequency-flat fading is more disruptive for M-FSK than PPM, as all M of the possible frequency-shifts are impaired by fading, while the short duration of the PPM pulse means that only a few of the M time-shifts are heavily impaired by fading.
Optical communications systems (even wireless ones) tend to have weak multipath distortions, and PPM is a viable modulation scheme in many such applications.
Read more about this topic: Pulse-position Modulation