General Order 40

The Federal Radio Commission's (FRC) General Order 40, dated August 30, 1928, described the standards for a sweeping reorganization of radio broadcasting in the United States. This order grouped the AM radio band transmitting frequencies into three main categories, which became known as Clear Channel, Regional, and Local. It also included provisions for coordination with Canadian station assignments. The majority of the reassignments resulting from the plan's implementation went into effect on November 11, 1928.

Radio transmissions in the United States were originally regulated by the Department of Commerce, as authorized by the Radio Act of 1912. The first formal regulations governing broadcasts intended for the general public were adopted effective December 1, 1921. This initially established just two transmitting wavelengths — 360 meters (833 kHz) for "entertainment" broadcasts, and 485 meters (619 kHz) for "market news and weather reports". The number of broadcasting stations grew dramatically in 1922, reaching over 500 by the end of the year, and the government began making available additional frequencies. By November 1924 a band of frequencies, from 550 to 1500 kHz, had been established, with higher-powered stations, known as "Class B", assigned to the frequencies from 550 to 1070, while lower-powered "Class A" stations were assigned to 1080 to 1500.

In 1926, the government's regulatory authority under the 1912 Radio Act was successfully challenged, and, for a chaotic period that lasted until early 1927, radio stations were free to use any frequency and power they chose, while the number of stations increased to 732. The Radio Act of 1927 was passed to regain control of the situation. The Act established a Federal Radio Commission, which reduced the number of stations, including eliminating "temporary" and "portable" stations. The Commission also reallocated frequency assignments to reduce interference and provide better service to smaller communities and underserved rural areas. A constraint was the Davis Amendment, which specified that the station assignments had to be equitably made throughout the country.

Two technical issues limited the number of stations that could operate without interfering with each other. These issues were especially important at night, when a change in the ionosphere meant that radio signals traveled much greater distances. Most transmitters at this time were unable to precisely control their output frequencies, thus, signals from two stations operating on the same nominal frequency would combine to make a high-pitched "heterodyne" tone that interfered with the reception of both stations. Secondly, directional antennas would not be developed until the early 1930s, so there was no effective method for limiting signals in a given direction.

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