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Multiple-input multiple output (MIMO) communication architecture has recently emerged as a new paradigm for wireless communications in rich multipath environment, which has spectral efficiencies far beyond those offered by conventional techniques. The channel capacity of the MIMO architecture in independent Rayleigh channels scales linearly as the number of antennas. However, the correlation of a real-world wireless channel may result in a substantial degradation of the MIMO architecture performance. In this letter, we investigate the MIMO channel capacity in correlated channels using the exponential correlation matrix model. We prove that, for this model, an increase in correlation is equivalent to a decrease in signal-to-noise ratio (SNR). For example, r=0.7 is the same as 3-dB decrease in SNR.