Abstract: A solution for optimizing beamforming configurations and transmit power allocation configurations in a telecommunication system comprising a base station and a plurality of user entities is provided. The base station and the user entities are capable of multiple-input multiple-output (MIMO) communications, i.e. capable of communicating through spatial subchannels. The base station calculates iteratively optimal beamforming configurations for the base station and for each user entity and transmit power allocation configurations for each spatial subchannel used in MIMO communications. The base station carries out the calculation on the basis of channel state information received from the user entities by utilizing the information on correlation of different spatial subchannels, i.e. interference between the subchannels, in order to update beamforming configurations and transmit power allocation configurations.