Question

what a modem does?

Answer 1

A modem is a device or program that enables a computer to transmit data over, for example, telephone or cable lines. Computer information is stored digitally, whereas information transmitted over telephone lines is transmitted in the form of analog waves. A modem converts between these two forms.

Answer 2

MOdulator-DEModulator
At the sender's end, signal is modulated or embedded with a carrier signal which can be transmitted physically over the wire.
At the receiver's end, signal is demodulated or the data is extracted from the modulated carrier wave.