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The Rician factor is the ratio between the mean power of the LOS path to the mean power of all other (non-LOS) paths. Increasing/decreasing this factor means increasing/decreasing the mean power of the LOS path. Does increasing the Rician factor improve or degrade transmission quality?

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A strong LOS component, i.e. a high Rician factor, will always improve receiver performance. If $K$ denotes the Rician factor, i.e. the ratio between the power of the LOS component and the power of the other (scattered) components, then for $K\rightarrow\infty$ you have no multipath propagation at all and you get a simple AWGN channel. For $K=0$ you have a Rayleigh fading channel (with no LOS component).

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