It was against this backdrop that the underground began to shift into phreaking. Phreaking is loosely defined as hacking the telephone system. It is a very loose definition. Some people believe phreaking includes stealing a credit card number and using it to make a long-distance call for free. Purists shun this definition. To them, using a stolen credit card is not phreaking, it is carding. They argue that phreaking demands a reasonable level of technical skill and involves manipulation of a telephone exchange. This manipulation may manifest itself as using computers or electrical circuits to generate special tones or modify the voltage of a phone line. The manipulation changes how the telephone exchange views a particular telephone line. The result: a free and hopefully untraceable call. The purist hacker sees phreaking more as a way of eluding telephone traces than of calling his or her friends around the world for free. The first transition into phreaking and eventually carding happened over a period of about six months in 1988. Early hackers on PI and Zen relied primarily on dial-outs, like those at Melbourne University or Telecom's Clayton office, to bounce around international computer sites. They also used X.25 dial-outs in other countries--the US, Sweden and Germany--to make another leap in their international journeys. Gradually, the people running these dial-out lines wised up. Dial-outs started drying up. Passwords were changed. Facilities were cancelled. But the hackers didn't want to give up access to overseas systems. They'd had their first taste of international calling and they wanted more. There was a big shiny electronic world to explore out there. They began trying different methods of getting where they wanted to go. And so the Melbourne underground moved into phreaking. Phreakers swarmed to PABXes like bees to honey. A PABX, a private automatic branch exchange, works like a mini-Telecom telephone exchange. Using a PABX, the employee of a large company could dial another employee in-house without incurring the cost of a local telephone call. If the employee was, for example, staying in a hotel out of town, the company might ask him to make all his calls through the company's PABX to avoid paying extortionate hotel long-distance rates. If the employee was in Brisbane on business, he could dial a Brisbane number which might route him via the company's PABX to Sydney. From there, he might dial out to Rome or London, and the charge would be billed directly to the company. What worked for an employee also worked for a phreaker. A phreaker dialling into the PABX would generally need to either know or guess the password allowing him to dial out again. Often, the phreaker was greeted by an automated message asking for the employee's telephone extension--which also served as the password. Well, that was easy enough. The phreaker simply tried a series of numbers until he found one which actually worked.