It works in a "compression" mode; the area of the loudspeaker diaphragm is significantly larger than the throat aperture of the horn so that it provides high sound pressures.
The next innovation came from E. C. Wente and A. L. Thuras in "A High-Efficiency Receiver for a Horn-Type Loudspeaker of Large Power capacity" in the Bell System Technical Journal, 1928.
[4] In 1953 Bob Smith made the most significant contribution to modern phase-plug, and hence compression driver design, with his paper published in the Journal of the Acoustical Society of America[5] in which Smith analyzed the acoustical resonances occurring in the compression cavity and devised a design methodology to suppress the resonances by careful positioning and sizing of channels in the phase-plug.
From this work improved phase plug design guidelines have been deduced to eliminate all traces of acoustical resonance in the compression cavity.
In some sound reinforcement and studio monitors the high frequency drivers are protected from damage by current sensing self-resetting circuit breakers.
An older circuit protection technique used by Electro-Voice, Community, UREI, Cerwin Vega and others is a light bulb placed in series with the driver to act as a variable resistor.