Formation of the early radio industry.

Regulation and government intervention was arguably the most important and influential factor in the shaping of radio in the 1920s because of its role in producing a cohesive, standards based radio industry controlled by American companies and interests.

The force of regulation and government intervention works to build cohesiveness by setting up specific stipulations and standards for how an industry or other operation should carry out its business.  It helps put competing businesses on the same page so that their competition becomes constructive rather than destructive.  Imagine if every electric company used a different standard for the voltage and regulation of the electricity it provided - it would bring great chaos and disorder because many electronic devices wouldn't work the same, or even work at all, depending on what provider the consumer was using.  The regulations set up by governments can operate much in the same way that train tracks work for trains; the tracks may seem firm and restricting if you looked at just the tracks themselves, but they actually allow the trains to operate effectively and safely.

This is a key reason why government regulation and intervention was so important to the formation of the radio industry.  When many more people started jumping on the radio bandwagon and radio stations and transmitters became more widespread, the problems grew just as rapidly.  Transmitters were being operated in frequencies too close to one another at too close of a distance, causing overlap and interference that often led to both stations being practically unlistenable.  Naturally, however, neither of a set of stations involved in such a conflict would be willing to just yield to the other(s), for fear of being taken over by the competition.  Other problems included amateur radio operators interrupting official government, nautical, and corporate transmissions, at times in the form of fake distress signals <Radio Act, Radio Act 1927.>  To solve these problems, the US Government increased their control over radio and licensed transmitters, defined the radio band (overall range of frequencies to be used for radio,) told the owners what frequency each could broadcast on, at what power they could do so, and even limited the times of day at which some transmitters could broadcast.  The government also fostered the growth of an early radio industry owned by American Corporations when it forced foreign interests out of the US, such as when Italian Marconi was "forced to sell its American assets to General Electric." (Media Now, 160)  This action in turned helped to foster the right conditions for the main American radio interests to set up a patent pool in 1920, which helped to standardize radio equipment, which brought even greater inter-operability and unification to the industry.