In order to improve the error probability of generating entanglement by communication for quantum computation, we propose the use of squeezed light. When generating entanglement between two atoms by communication, the error probability can be reduced by increasing the distance between quantum states of probe light in phase space. The phase rotation of light depends on the atom-photon coupling strength and the light amplitude, which are limited in practice. A large error probability has been expected for coherent probe light. If we assume typical values of light amplitude and phase rotation, $\ensuremath{\alpha}=100$ and $\ensuremath{\theta}=0.01$, the error probability is estimated to be
Pcoh(min)=0.14 and
Pcoh(hom)=0.23 for minimum error discrimination and homodyne measurements. The error probability can be reduced to ${P}_{\mathrm{squ}}^{(\mathrm{min})}=1.73\ifmmode\times\else\texttimes\fi{}{10}^{\ensuremath{-}8}$ and ${P}_{\mathrm{squ}}^{(\mathrm{hom})}=4.09\ifmmode\times\else\texttimes\fi{}{10}^{\ensuremath{-}5}$ using squeezed coherent light, where the same values of the mean photon number and the phase rotation angle are assumed for the coherent light probe. These values satisfy the requirements for scalable quantum computation.
We propose a scheme to generate a displaced macroscopic superposition of phase squeezed coherent states by incorporating an optical parametric oscillator (OPO) and a nonlinear Kerr medium in a Mach-Zhender interferometer configuration. We show that the phase squeezed coherent state generated by the OPO evolves into a macroscopic superposition of phase squeezed coherent states on spending a specific amount of time inside a Kerr medium. The phase space displacement is achieved by the interference of the intense reference beam with the signal in the final beam splitter of the interferometer. The noise of the reference beam contaminating the signal is prevented by making this beam splitter highly reflective. We have calculated the photon number uncertainty of the outcoming beam and have shown that it is smaller than the usual amplitude squeezed coherent state's value.