We review the formalism required to investigate the combined effects of polarization-mode dispersion (PMD) and polarization dependent losses (PDL) in optical fiber networks. The combination of PMD and PDL may lead to anomalous dispersion, which is not correctly described by a direct application of the Jones matrix eigenanalysis (JME) method. This calls for a careful assessment of PMD measurement methods in the presence of PDL. We also present a theoretical analysis of distortions in analog transmissions, and computer simulations of digital transmissions. These show that distributed PDL increases the power penalty of the transmission more than lumped PDL at the end of the channel.