A channel with output 

 is examined, The state 

 and the noise 

 are multivariate Gaussian random variables ( 

 is the identity matrix.). The input 

 satisfies the power constraint 

 . If 

 is unknown to both transmitter and receiver then the capacity is 

 nats per channel use. However, if the state 

 is known to the encoder, the capacity is shown to be 

 , independent of 

 . This is also the capacity of a standard Gaussian channel with signal-to-noise power ratio 

 . Therefore, the state 

 does not affect the capacity of the channel, even though 

 is unknown to the receiver. It is shown that the optimal transmitter adapts its signal to the state 

 rather than attempting to cancel it.