Is there a "transponder" underneath the copper wire in the diamond key inductive coil

bluebee · Feb 9, 2011

Is there a "transponder" underneath the copper wire in the diamond key inductive coil

If someone has an old "diamond" key, can they kindly cut it open and remove the inductive coil and then unwrap the copper wires so that we can tell, for sure, whether there is a "transponder" (an easter egg, of sorts) UNDERNEATH all that copper wire (or not)?

The reason I ask is this square2diamond key retrofit says there is a transponder underneath all that copper wire:
- DIY - easy way to make a brand new diamond key work in your older car (96-00)

And, this diamond key makeover DIY intimates the same thing:
- Diamond Shape Key Makeover

But, both DIYs would be much easier if one did not have to remove that inductive coil.

Next person who has an old useless diamond key, can you unwrap the coil for us and tell us what you find?

lukas22rojas · Mar 25, 2011

That is not the transponder

Definitely is not in there, I'm pretty sure it is the antenna.
I did unwrap this thing, one end of the wire is soldered to one of the metallic grips, after that I got two black parts, one plastic and one ferrite.

QSilver7 · Mar 26, 2011

Pics & Technical Info about the New Style Key (diamond shaped)

Thanks you lukas22rojas for posting a pic of that coil UNWRAPPED. As I've stated in previous posts...some of the DIYs for the new style key have ERRONEOUSLY referred to the copper (charging) coil as the transponder...and I've even posted a PIC that actually shows where the transponder is located on the new style (diamond shaped) key. It is the small square chip (soldered to the circuit board) next to the copper coil.

To whomever took the pic below...I apologize for amending it without your permission...but the (EWS) transponder chip is identified for those who may be confused by previous DIYs that incorrectly identify the copper charging coil as the transponder. The coil receives a signal from the Ring Antenna which charges the battery inside the key.

And here's BMW technical info that explains how the NEW STYLE KEY (diamond shape) has a rechargeable battery that is kept charged though induction by a signal sent from the Ring Antenna to the copper charging coil on the key's circuit board.

bluebee · Mar 27, 2011

QSilver7 said:
some of the DIYs for the new style key have ERRONEOUSLY referred to the copper (charging) coil as the transponder...

IIRC, these two threads, by way of example, say that (erroneously):
- DIY - easy way to make a brand new diamond key work in your older car (96-00)
- Diamond Shape Key Makeover

So that we don't lead others astray, I cross referenced both those threads to this thread just now.

QSilver7 said:
posted a PIC that actually shows where the transponder is located on the new style (diamond shaped) key. It is the small square chip (soldered to the circuit board) next to the copper coil.

Very interesting. So 'this' is the transponder in the original pic in the OP above?

anthony1968 · Mar 27, 2011

thanks for the info!! big help.

bluebee · Mar 27, 2011

BTW, I had forgotten about this plea for value added - so I thank both lukas22rojas & QSilver7 for their valuable additions for the tribal knowledge of the team as a whole.

To ensure this information is re-used efficiently, I modified the bestlinks reference for the diamond shaped key to the following:

- The truth about the BMW diamond key transponder (1) and proper initializing (1) (2), opening, charging, recoding, & battery replacement (1) of the new-style diamond key (1) (2) (3) (4) (5) (6) & converting the old-style 1996-2000 "square" key to a diamond key (1) & how to replace the rubber key pads in the old style keys (1) (2)

bluebee · Apr 4, 2011

There is useful information about the fact that even the plastic (valet/service) key has a transponder chip in it over here:
- E39 (1997 - 2003) > Is 5 series so secured?

If anyone has a picture of this plastic-key transponder, it would be interesting to see.

michaelvn · May 25, 2011

Key problem

Hi there, I need some urgent help from you guys.
Can someone with high resolution photo of the key, or can open the key to read the marking on a component which is marked in red arrow in my attached picture.
I accidentally damage it while opening the key for battery replacement and apparently the remote function stops working.

Really appreciate it!:thumbup:
Thank you!

bluebee · Jun 13, 2011

michaelvn said:
read the marking on a component which is marked in red arrow in my attached picture

I just saw this (researching something else); but all you had to do was go to the bestlinks to find lots of information (mostly from QSilver7) on the transponder informaiton you seek.

For example:
- Diamond key functions (1) & the truth about the BMW diamond key transponder (1) and proper initializing (1) (2) and the truth about the 10-key limit to programming your own keys at home (1) & opening, charging, recoding, & battery replacement (1) of the new-style diamond key (1) (2) (3) (4) (5) (6) & converting the old-style 1996-2000 "square" key to a diamond key (1) & how to replace the rubber key pads in the old style keys (1) (2) & what to do if your key is locked inside your car (1) & a description of the various types of BMW "Remote", "Illuminated", "Spare/Wallet", & "Valet/Service" keys (1) (2).

BTW, QSilver7 posted a nice remote-key function summary here today:
- E39 (1997 - 2003) > 2002 BMW 525i E39 Key Issue

QSilver7 said:
the remote has THREE features incorporated into them:

EWS - immobilizing drive-away-protection which shuts down ignition/injection/starter...this system is self powered and does not need the battery inside the key...nor can it be programmed to work on another car.

DWA - alarm anti-theft siren system...this feature can be programmed to other BMWs that use the same 315 MHz frequency and requires a working battery inside the key.

FZV - keyless entry system...this feature can be programmed to other BMWs that use the same 315 MHz frequency and requires a working battery inside the key.

Here's his shot in that post of the transponder chip in the old-style key:

titan0508 · Nov 2, 2011

Hi, I am a newbie here and to DIY; even though I have read that you can program the remote but when I asked the seller on eBay for the blanks, he told me that I have to bring it to the dealer for programming. So I am confused, is it because the transponder needs to be and can only be programmed at the dealer, or am I missing something here? Please help. Thanks.

QSilver7 · Nov 2, 2011

Here's the information again:

The remote key has 3 different features that work in conjunction...but are separate features:

EWS - immobilizing system which uses a programmed transponder in the key that is UNIQUE to your car's VIN and does NOT require any power from the key's battery...it is self powering thru induction using the Ring Antenna around the ignition and the coil that can be seen in the pics above
FZV - is the keyless entry feature which operates the central locking sytem to lock/unlock the car using the 315MHz radio frequency (in the USA) that is transmitted to the receiver in the car. It requires the battery inside the key and can be programmed to other BMWs that use the same system.
DWA - is the anti-theft alarm siren system that uses the same 315 MHz radio frequency and arms/disarms the multiple sensors around the car. It uses the battery inside the key and can be programmed to other BMWs that use the same system

BMW dealerships do NOT cut keys...they order them from BMW NA which ships the key already CUT based on your car's VIN...as well as the EWS transponder which will already have the unique ISN (individual serial number) burned to it so that it will start your car. The FZv/DWA features need to be programmed when the car & key are together. But you can do this yourself by following the instructions that get posted just about once a week. (see them posted again, below)

If you buy a new style key "case" off of eBay and your original key is the same type...once you find a local KEYSMITH that can cut the blank...all you need to do is swap the innards of your original key over into the key case you've purchased off of eBay. Make sure you purchase the CORRECT type of key blade....there are multiple types and you have to have the CORRECT kind.

Once you have swapped the guts of your key into the new key case that has now been cut by your local KEYSMITH that allows you to manually lock/unlock the car and start it...follow the instructions below to program the FZV/DWA features to operate the remote features:

titan0508 · Nov 3, 2011

Hi, thanks for the speedy response. The eBay seller was selling a blank with brand new chips in them, so it's a brand new chip and transponder. Links below:
http://www.ebay.com/itm/BMW-BRAND-N...Truck_Parts_Accessories&fits=Make:BMW&vxp=mtr&hash=item1e6810e09e#ht_2088wt_764
http://www.ebay.com/itm/BMW-REMOTE-...ries&fits=Year:2001|Make:BMW|Model:X5|Submodel:4.4i&vxp=mtr&hash=item2a133d79c8

If I am reading this right, the dealer is the only ones that can program the immobilization transponder to my VIN right?

QSilver7 · Nov 3, 2011

Right...but not even the "dealer" has the ability to assign your car's ISN (individual serial number) to the EEPROM (transponder) inside your key that allows it to start your car. That is done by BMW NA (here in the State), then the key is shipped to the dealer to sell to you with the EWS transponder already coded to your car.

This eBay seller is doing double speak. They apparently know that the EWS transponder has a unique code...and even mentions that BMW needs to do it...but then flip-flops and says that a keysmith can cut and program the transponder. HUH? Where is a local keysmith going to get the ISN code that is specific to your BMW versus the thousands that BMW sells? BMW doesn't even give this information to the local BMW dealership...so how is a regular Joe Schmo from anywhere USA going to be able to get this info? :dunno: And I just provided you the info on how to program the key to lock/unlock & arm/disarm the car above.

4.YOU CAN GET THE REMOTE PROGRAMMED BY FOLLOWING INSTRUCTION I PROVIDE WITH KEY,NO TOOL NEEDED.YOU CAN GET REMOTE PROGRAMMED WITHIN 1 MIN,THEN YOU NEED TO GET THE KEY CUT AND TRANSPONDER PROGRAMMED BY LOCKSMITH[/B](DEALER WON'T GET THE KEY CUT AND PROGRAMMED,THEY ORDER KEY FROM GERMANY BY YOUR VIN# AND CHARGE YOU OVER $350!!)

Also...remember what I wrote about multiple types of keyblades? The links you provided are for TWO different types of keyblades. One of them is UNLIKE your key and wouldn't work even if you did get the blade cut and the chip programmed.

titan0508 · Nov 3, 2011

Thanks, you have been most helpful. I just bought the X5 and the previous owner only has one key left. The two local dealers quoted 198 and 225 respectively for a key. So thinking I could save myself some money, I did some research and almost bought the key. BTW, both eBay sellers sells both types of keys, though it doesn't matter any more as it seems like I need to go to the dealer tomorrow.

QSilver7 · Nov 3, 2011

titan0508 said:
...The two local dealers quoted 198 and 225 respectively for a key.....

Unless you actually need another remote key...you could always go with one of the other 4 types of keys if all you really need is a spare/back-up/emergency key.

See if your local BMW dealership will match the prices of one of the other nationally advertising BMW dealerships like BMW SILVER SPRING or TOMKINSON BMW.

Below, you can see the prices from BMW SILVER SPRING's website ( http://getbmwparts.com/ ) ...the list below was gathered this past summer...I haven't gone back to check if prices have changed. Another competitive BMW dealership is Tomkinson ( http://www.bmwpartscenter.net/partlocator/index.cfm?siteid=215996 )...you can check their prices (using the BMW part nbrs from the list below) to see what they are selling the keys for. Perhaps your local dealerships will match pricing (if you print out a page with the price list).

Again, there are other keys that cost much less money if you don't require keyless entry:

jeepo23 · Nov 18, 2011

What a wealth of info! Just what I was looking for!
Few questions tho, and wondering if this has been done.

If a valet key is bought? does this actually start and run the car for an unlimited amount of time? The reason I ask is because I read that the valet key is only "supposed" to run the car for 10minutes and shut it off, basically just enough for the guy to park it.

What I was thinking of doing, my keyfob is toast.. I can't seem to start my car with it but I can unlock/lock it using the buttons. It appears the transponder is gone in it.

What if a valet key (or the cheapest option from dealer) is purchased and if the transponder if there is any inside of it is taken and put into a master fob shell.

Should that not yield a fully working master key?

What I am trying to avoid is paying the dealer $200+ for the master key.. I have 2 master keys but one does not work it will not start the car.. but all other functions work.

michaelvn · Nov 18, 2011

To jeepo23: I don't know where did you read about valet key, but I drive with it for hours.
Remote and transponder are two separate functions within a bmw key fob, they share some circuitry btw.
There's no cheap way to make a new key that can start your car. Only 2 options:
1. Go to BMW and get it, it's of course more expensive but risk free.
2. Go to a locksmith that has equipment and know how to do it. He will need to take out your ECU (EWS), dump the EPROM content into an external device and retrieve a code that need to be written into the new transponder. This step involves the risk of having a copy of your car "secret" with the locksmith, and he can make more keys that potentially can steal your car. There's one more step is to program the car to accept the new key, but this can be done easily and quickly with a laptop hooked up to the diagnostic port.
There's no other way, so down here in Australia where new key from bmw cost close to AUD700, I always advise friends to get a non-remote key at 1/3 the price then transplant it into an eBay fob. The cost is about the same to getting a locksmith to do the eBay key, but it's risk free.
But frankly, who care about theft? BMW cars are usually insured more than actual resell value so if it's get stolen, it's a win

jeepo23 · Nov 19, 2011

Sorry bud but I am not following your second option one bit. I've never heard of a locksmith being able to dump ECU's and EEPROMS etc.. I think over complicating matters to be honest.

Basically if a valet key is bought, it starts the car so that means it has a transponder in it. In my situation I cannot start my car with my master fob as the transponder appears to be dead. So taking the transponder from this valet key and putting it in the master fob should resolve this issue and have a working key for a factor of the cast.

But since I am in Canada and only one that can provide keys is the dealer the valet key alone is $100.. Seems a bit steep. I wish I was in america since for USA based ViN vehicles you can get a master fob for ~$120. While the dealer from me wants like $200+..

Also the fob is 2 separate circuits. One circuit is used for remote unlock/lock functions while the other circuit is used for the EWS authentication and starting of vehicle. The two circuits have nothing to do with each other.. That is why you can get a ebay key and program the unlock/lock functions right out of the box without having any other programing/diagnostics/laptops. Also the battery has nothing to do with the transponder on the chip, the battery is strictly used for unlock/lock functions.

michaelvn · Nov 19, 2011

Hey if it's only $200 then get the master key from BMW.
I'm not trying to argue or convince you of anything, just that I've spent close to 6 months researching exhaustively for alternative solutions.
The EPROM dump is what I read from the user manual of those programmer that locksmiths use, and also correspond with my knowledge of the ELMOS chip that does the transponder business in the key.
And the circuitry that shares between remote and transponder is the coil. You remove the coil, the battery won't charge and the transponder won't work.
You take out the transponder chip, the fob won't charge as well.

jeepo23 · Nov 19, 2011

So the transponder is the 8pin IC chip then?

bluebee · Nov 19, 2011

For the record, through the process of 'incrementalism', the bestlinks on the key (filled to the brim with QSilver's wisdom) ... is currently ...

- How to replace the old-style BMW E39 square key battery (1) (2) (3) & how to replace the rubber key pads in the old style square keys (1) (2) & opening, charging, recoding, & battery replacement (1) of the new-style diamond key (1) (2) (3) (4) (5) (6) & how to recharge off your BMW and how long a BMW key will last in the drawer before it needs that off-the-car recharging (1) & converting the old-style square key to the newer diamond shaped key (1) & the details on swapping the BMW diamond key transponder (1) & proper diamond key initializing (1) (2) & what to do if your key is locked inside your bimmer (1) & a description of the various types of BMW Remote, Illuminated, Spare/Wallet, & Valet/Service keys (1) (2) & a list of diamond key EWS, FZV, & DWA functions (1) (2) & all about the 10-key limit to programming your own keys at home (1) & a description of the ignition key ISN (individual serial number) ten-second rule (1) & what to do if you lost your only diamond key (1) or what to do if your BMW key was stolen (1)

michaelvn · Nov 19, 2011

To jeepo23: Yes it's ELMOS 10030A. This chip usually last forever so if you've some electronic skills, try to check the coil and circuit that hook up to it.
If you're lucky, it could be a case of the coil break or circuit break that doesn't allow the chip to power up and read signals from the car.

jeepo23 · Nov 19, 2011

michaelevn thanks for the info! I really wish that was the case. I had the key sent in for repair as I found this service and heard about it on e46fanatics. http://www.bmwgm5.com/

The guy was not actually able to repair my fob.. he said it was the first key he encountered like that lol..

This is what he told me; this is for the key that won't start the car. I was only able to send that one in as I needed to keep the other key in order to drive the vehicle (on that key the remote unlock/lock functions don't work..)

This was a really weird key. You say it doesn't start the car, but, I can find no problem with the EWS pickup coil which I normally find bad. Then the key fob doesn't work correctly despite all the switch working fine, and no broken solder joints that I can find. This is the first time I've gotten in a key that was this bad AND not been able to repair.

m3crazyness · Nov 21, 2011

Can you remove the transponder from a diamond key board?

I have a question. Can you remove the ews transponder from a diamond key circuit board? I received 2 diamond keys when I bought my car. Both started the car but only one remote worked. I guess the battery in the second set was dead. I put it in my electric tooth brush charger as others suggested with no avail. To save myself $200 from the dealer, I gutted the non working remote, purchased a panasonic rechargeable battery and replaced it, and reprogramed it. Now I have two working keys with working remotes. Since I had to physically break the case to change the battery, I purchased this flip key case from ebay complete with screws so I can close the case and change the rechargeable battery if it goes bad again. I placed the guts and the new battery into the case. I had the key cut by a local locksmith (liberty lock and key/stanley in Las Vegas) and it works in all the cylinders (ignition, door, trunk, and glove box) but won't start the car. Based on my trial and error, the EWS transponder embedded into the circuit board is too far from the sensor to start the car. When I took the guts out and placed it near the key hole opening, it started. Is it possible to remove the chip and place it closer to the key blade so it is in its original position within the original diamond key? If not, its cool. I priced a plastic pocket key from Desert BMW for $87 and plan to remove the ews and stick it in the new case if all else fails...... Just not in the mood to spend $87 + tax for something I already have. Any suggestions appreciated!!

michaelvn · Nov 21, 2011

To m3crazyness: The transponder get signal from EWS through the coil, and the coil does charging too.
Based on what you described, the coil or the connecting circuit may be bad.
Removing the chip map not help, and even risky. It requires great skills to desolder it without frying it.

QSilver7 · Nov 21, 2011

jeepo23 said:
Here is my key situation to give you guys a better idea.

We will call it Key A and Key B. Now I will start of as they were last sunday before I started any programming/initializations and gut swapping.

Click to expand...

Just to make sure we are on the same page...you followed the instructions below when programming both your remote keys to lock/unlock & arm/disarm your car? Remember, you can NOT insert the 2nd key into the ignition when you go to program it...you start the 2nd key on STEP 3 where you PRESS & HOLD button 2. If you insert the 2nd into the ignition...the first key will no longer work because you've started a new programming session...this feature causes any remote keys not programmed during a single session to NO LONGER have the ability to remotely unlock the car...which comes in handy if you ever lose a remote key. :

jeepo23 · Nov 21, 2011

Yea thats exactly what I followed.

But funny enough I managed to get Key B working last night.. I tore it apart for the 3rd time, tried doing a battery swap for the hell of it, even tho I knew the battery in it was good as it read 3.04V when i checked it.

So putting in a new duracell battery trying to sync.. still nothing. came back in the house and put my old (original) battery back in went to try for fun and it actually synced and worked!!! I couldn't believe it. So now I got the 1 key that actually remote unlocks/locks and starts the vehicle (Key B). No idea why it works now and not before, I figure there must of been a short circuit or something perhaps, so by me breaking the solder connection on the metal tabs and nicely sliding in the battery again fixed it!

Still have Key A that can remote unlock/lock but not start the car, I can play around with that key now once I get it back. I know this key has some sort of transponder issue that I have sent off for repair to a place and the guy came back saying that everything checks out okay.. so he's not sure where the issue lies.

bluebee · Feb 24, 2013

For the record, here is a set of related threads:
- How to replace the old-style BMW square key battery (1) (2) & how to replace the rubber key pads in the square keys (1) (2) & what can go wrong with a key and where to send it for repair (1) (2) (3) & what battery to use in the new style 2000+ BMW E39, E46, E53, E85, etc. diamond key (1) (2) (3) (4) (5) (6) (7) & a square key to diamond key retrofit and transponder swap (1) (2) (3) & how to recharge your key out of your BMW and how long that key will last in the drawer before it needs that off-the-car recharging (1) & the details on swapping the BMW diamond key transponder (1) & the proper diamond key initializing or programming sequence (1) (2) (3) (4) & what to do if your only key is locked inside your bimmer (1) & a description of the various types of BMW Remote, Illuminated, Spare/Wallet, & Valet/Service keys (1) (2) & a list of diamond key EWS, FZV, & DWA functions (1) (2) & all about the 10-key limit to programming your own keys at home (1) & a description of the ignition key ISN (individual serial number) ten-second rule (1) & what to do if you lost your only diamond key (1) or what to do if your BMW key was stolen (1)

oldskewel · Dec 3, 2014

I recently bought a 2001 X5 (E53) with only one key = a diamond key. I don't want to spend too much on spare keys, and might be willing to sacrifice EWS functionality. Would the following plan work?

1. permanently install the guts of the diamond fob (everything needed to support EWS, which might most easily mean everything) in the steering column, close enough to the transponder there.
2. buy blank transponder keys on ebay, have the blanks cut, and program them myself for keyless entry.

QSilver7 · Dec 3, 2014

You do know that there's a perfectly good e53 forum here.

And could you be more specific as to what is TOO MUCH to spend on a key? Non remote keys can be purchased from your local BMW dealership for around $50 (give or take $20 depending on the local market).

And the remote keys (at least the new style diamond shaped keys) have everything soldered to the internal board...so that means if you remove the EWS chip...you also remove the FZV (central locking) and DWA (anti-theft alarm siren) features of the key, too.

Again, $50-$70 bucks can get you a brand new non-remote key that will start the car, and work in all the lock cylinders (if you don't count the VALET key).

E39Hoon · Dec 3, 2014

First you would only need to install the transponder chip very close to the the ignition ring. This does sound like it could work. However, you would be making it that much easier to steal your car.

oldskewel · Dec 3, 2014

Thanks for the quick responses.

E39Hoon: "First you would only need to install the transponder chip very close to the the ignition ring."

My understanding is that in addition to the chip itself, I'd also need the coil (part H in the diagram) since it powers the transponder chip. At that point, I may as well include the whole circuit board, but maybe not the battery. Right?

E39Hoon: "However, you would be making it that much easier to steal your car."

Not really a concern. And this car actually has LoJack, just in case.

QSilver7 - ...
E53 vs. E39 - those are the same regarding this system though, right? Yes, I'm figuring things out as fast as I can here.

"Too much" - for me it's mainly not wanting to be extorted by the man. I'd pay $500 if it were a fair price.

I was very surprised at the low prices you listed so I made a quick call to my local dealer (Peter Pan in Burlingame, CA) and you are right! Full remote key (cut, programmed, EWS) is $182 out the door. Non-remote master key is ~$72 (cut, EWS, illuminated, price may be before tax). Valet key is ~$50 (cut, EWS).

So yes, I probably don't need to launch a huge research project to stick it to the man. Thanks for saving me all that effort.

oldskewel · Dec 4, 2014

oldskewel said:
I was very surprised at the low prices you listed so I made a quick call to my local dealer (Peter Pan in Burlingame, CA) and you are right! Full remote key (cut, programmed, EWS) is $182 out the door. Non-remote master key is ~$72 (cut, EWS, illuminated, price may be before tax). Valet key is ~$50 (cut, EWS).

Update on pricing ...
I ended up getting keys from thebmwminipartstore.com. They required me to email photos of my license and registration and will mail the keys to me, ready to go except for programming the keyless entry stuff, which I can do. Excellent communication and customer service from those guys.

For my E53, the only options they gave me based on my VIN (i.e., no plastic key, no main non-remote key, no lighted main non-remote key, even though they showed up in their parts system) are:
66126955750 for the 3-button diamond key
and
51218236594 for the valet key. For the X5, the only thing this is lacking is opening the glove box lock, which I can live with.

Prices are $120 for the diamond key and $39 for the valet key. 10% coupon code BIMMER took care of the shipping and then some.

So it was definitely not worth it for me to turn this into an unneeded research project. On to other projects now.

E39Hoon · Dec 3, 2014

You probably have the diamond key since your car is newer. I've seen stuff that says the transponder does need power, but it only looks soldered in place. You can verify this by desoldering the transponder and placing it by the ignition ring and seeing if it will work. But then you would be risking a key out of it and not being able to drive if that were your only key and it did not work.

My E39 originally came with the old style roundish square key. I took the transponder out of there and installed it into a fob that the new BMW's come with. Except my fob has a flip key on it since my car uses a physical unlike new BMW's. So if you have that older key the transponder can be moved no problem.

oldskewel · Dec 4, 2014

E39Hoon said:
You probably have the diamond key since your car is newer. I've seen stuff that says the transponder does need power, but it only looks soldered in place...

Yes, 2001 E53, diamond key.
The only reason I thought the coil (H in the diagram) was required was because of the legend there for "(H) EWS pickup and battery charge coil". I guess also having the EWS transponder soldered down at 8 points made me think there's more going on there. But yes, if I were to proceed with this, I'd try it as a standalone since that makes at least as much sense.

Thanks for the help.

QSilver7 · Dec 3, 2014

The EWS transponder (in the old style & new style key) is powered thru induction and receives a 125 KHz AM signal that gets sent from the EWS control module to the Ring antenna (around the ignition). Since EWS uses a transponder (meaning 2-way communication)...the chip sends back the ISN (individual serial number) data...which is then verified by the EWS control module & DME/ECU...if the number and rolling tables match...then the car is release for starting.

The FZV & DWA features of the key (central locking & alarm siren system) transmits a 315 MHz RF signal (433 MHz in Europe) to the aerial in the rear windshield, then onto the receiver in the C pilllar, which then sends the data to the GM III where the info required for FZV to lock/unlock the car...and for DWA to arm/disarm the alarm siren system) is taken care of. And to transmit this 1-way signal...the battery inside the key is required. The new style keys have the copper coil...which charges its internal battery that's soldered to the IC board...so that the 315 MHz signal can be sent for the FZV/DWA features of the remote key.

Ignore the information about the Transmitter Receiver Module if your e39 is built after3/1997...that's because this module was dropped with the debut of EWS 3.2 and it's function incorporated into the EWS control module:

Is there a "transponder" underneath the copper wire in the diamond key inductive coil

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