A transponder is an electronic device used to wirelessly receive and transmit electrical signals. Fittingly, its name is equally derived from the words "transmitter" and "responder." It was originally developed to be attached to an object that needed to be located, and some are still used in this manner today.
This device functions by receiving a signal, called an "interrogator" because it is effectively "asking" for information, then automatically conveying a radio wave at a predetermined frequency. In order to broadcast a signal on a different frequency than the one received, a frequency converter is built in. By receiving and transmitting on different frequencies, the two signals can be detected simultaneously.
The first use of a transponder was on an aircraft during World War II, as part of the Identify Friend or Foe (IFF) system. By answering secret interrogation frequencies, pilots could indicate to radar operators that they were friendly aircraft.
These devices are still common today in both military and commercial aviation. They receive a signal from the ground, and then automatically reply with an identification code for air traffic controllers, as well as altitude information. In aircraft applications, they are also configured to amplify the signal in order to make the plane more visible on radar.
They are also used to measure distance by calculating the elapsed time between the sending of the interrogator signal and the receipt of the transponder's signal. For example, sonar devices are used to mark underwater positions, calculate depth, and trace positions.
It may sound as if this is a technology that the average consumer never uses, but even if that was once the case, it no longer is. The modern commuter probably has at least one transmitter in his car, probably mounted on the windshield or dashboard. These are for roads that use electronic tolling systems that compute the amount of tolls to be paid and complete the transaction without requiring the driver to so much as lower his window. Some newer cars are also equipped with ones that operators can use to locate the vehicle in the event of an emergency. Cellular phones use a similar, albeit smaller, chip to send the phone's location if it used to call an emergency number.
Even casual television viewing often involves the use of these devices. A network can uplink its ground-based satellites to communications satellites orbiting the Earth, send multiple channels of digitally compressed video and audio to a single transponder aboard it, and local stations can then pick up the program and re-broadcast it locally by aiming the appropriate ground-based dish.