Statistical multiplexing, such as used in packet switching, is based on estimations of activity and therefore the likely packets that will take place over a communication medium (Chandra (2003)). As these estimations change over time the communication medium may be used by many packet sources and destinations and the transmission of packets is subject to availability of the resource, i.e. there is no preset method by which packet switching operates and therefore its multiplexing is statistically organised.
Time Division Multiplexing (TDM) is organised into preset time slots for every request (demand) and therefore although TDM circuit switching is multiplexing, this is organised and controlled. TDM does not react to requests or an estimation of the uses as with statistical multiplexing and cannot change the pre-set time slots to accommodate or optimise network traffic.
Chandra, K (2003) Statistical Multiplexing [Online]. Available at http://morse.uml.edu/research.d/traffic/publications/statmux03.pdf (Accessed 13 Apr 2011).