When placed it in you settlement it can be used to equip the radio tool by setting it to a hotkey.
This will add a radio frequency tab on you UI, in the lower left area, that you can adjust to any radio frequency. Any message transmitted at this radio frequency will pop up in your chat box allowing, among other things, long distance text chat.
For example, if a proximity sensor finds a target it says "Alert <name> has been detected at <coordinates>" on the frequency it is set to. A player listening to the same frequency would see the message.