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This paper presents the results of a study of the basic factors underlying the selection of a preferable method of transmission for pulse-code modulation communication systems. A new method of transmission, called biternary, is described and is compared with quaternary transmission, as a means of doubling the channel capacity of PCM systems without requiring increased bandwidth or transmission facilities. It is found that biternary transmission is more tolerant of the effects of all types of interference than quaternary transmission, and significantly reduces a major problem of quaternary transmission excessive errors, caused by low frequency cut-off effects. The use of biternary transmission is planned in present and future military pulse-code modulation communication systems.