Using a conductive capacitor that is integrated as part of the pen, it connects to an electromagnetic field generated by an excitation coil in the digitizer.

ENGADGET: N-trig's Digital Pencil plays pen and fingertip roles, claims mastery of both

The DuoSense software identifies the position of the Pencil and the pressure level, removing the need for an excitation coil within the DuoSense digitizer and can be used either as an integral part of the solution or as an optional after-market accessory, enabling OEMs to offer system upgrades, making the Digital Pencil ideal for the consumer market.

ENGADGET: N-trig's Digital Pencil plays pen and fingertip roles, claims mastery of both