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This paper discusses the implementation and cost- and performance-evaluations of a distributed processing network, called DONA-α, which is one of the possible physical networks mainly implementing connection-oriented public switched network functions corresponding to OSI layers 1 to 3. The first feature of the DONA-α network is that it separates a switching subsystem and a control subsystem of a conventional switching system and independently allocates them over distributed nodes as a switching node and a control node. Each DONA-α switching node is given a much smaller switching capacity than the switching subsystem of the conventional switching system and is located near subscribers. In contrast, each DONA-α control node has much higher performance than the control subsystem of the conventional switching system. This allows a large number of switching nodes to share the same control node, which controls their connection setups. This separation provides the network with greater flexibility and allows more effective utilization of network resources, such as control processors, switching fabrics, and transmission links, than ever before. The second feature of DONA-α is that it provides a network with network wide distribution transparency. This allows network resources including software such as databases and application programs to be shared and therefore to be utilized in the network more easily and more efficiently. The results of a network performance simulation and cost calculation confirm the viability of the DONA-α network.