- We investigate the effect of packet delays and packet drops on networked control systems. First we consider the problem of where to locate a controller or state estimator in a network, and show that under a Long Packets Assumption (LPA) it is optimal to collocate it with the actuator. We then show that under the LPA, stabilizability is only determined by the packet drop probability and not the packet delay probabilities. We also consider a suboptimal state estimator without the LPA, based on inverting submatrices of the observability Krylov sequence. 2008 IEEE.