A very common and typical example is the AGC used in AM radio. Such a receiver is essentially linear—the sound volume is proportional to the radio signal strength, because the information content of the signal is carried by the changes of amplitude of the carrier wave. If the circuit were not linear, the modulation could not be recovered with reasonable fidelity. However, the strength of the signal received will vary widely, depending on the power and distance of the transmitter, and signal path attenuation. The AGC circuit keeps the receiver in its linear operating range by detecting the overall strength of the signal and automatically adjusting the gain of the receiver to maintain an approximately constant average output level. For a very weak signal the AGC has no effect; as the signal increases, the AGC reduces the gain.
It is usually disadvantageous to reduce the gain of the front end of the receiver on weaker signals as this can worsen signal-to-noise ratio and blocking rejection. Many designs reduce the gain of the first stage only for stronger signals, known as a delayed AGC circuit.
A related application of AGC is in radar systems, as a method of overcoming unwanted clutter echoes. This method relies on the fact that clutter returns far outnumber echoes from targets of interest. The receiver's gain is automatically adjusted to maintain a constant level of overall visible clutter. While this does not help detect targets masked by stronger surrounding clutter, it does help to distinguish strong target sources. In the past, radar AGC was electronically controlled and affected the gain of the entire radar receiver. As radars evolved, AGC became computer-software controlled, and affected the gain with greater granularity, in specific detection cells.
An audio tape generates a certain amount of noise. If the level of the signal on the tape is low, the noise is more prominent, i.e., the signal-to-noise ratio is lower than it could be. To produce the least noisy recording, the recording volume should be set as high as possible without being so high as to clip or seriously distort the signal. In professional high-fidelity recording the level is set manually using a peak-reading meter.
If high fidelity is not a requirement, a suitable recording level can be set by an AGC circuit which reduces the gain as the average signal level increases. This allows a usable recording to be made even for speech some distance from the microphone of an audio recorder. Similar considerations apply with VCRs.
The disadvantage of AGC is that when recording, say, music with quiet and loud passages, the AGC will tend to make the quiet passages louder and the loud passages quieter, reducing the dynamic range and losing musical quality.
Most VCR circuits use the amplitude of the vertical blanking pulse to operate the AGC. Video copy control schemes such as Macrovision exploit this, inserting spikes in the pulse which will be ignored by most television sets, but cause a VCR's AGC to overcorrect and corrupt the recording.