How does Bluetooth work? The simple answer is active frequency hopping with Gaussian frequency-shift keying or, in later versions, pi/4 DQPSK (differential quadrature phase shift keying). However, I suspect that isn’t the answer that was expected.
The original Bluetooth specification appeared in the late 1990s and was around 700 pages long. I know that because I was tasked with reading it at work. The original specification was indeed for a range of 10m. However, there were different power levels in the specification giving ranges of around 1m, 10m and 100m.
There are now many variations within both Classic Bluetooth and Low Energy Bluetooth, with ranges up to 300m. As is often the case in hi tech what started out as a fairly simple system for wireless headsets is now so complicated that designers have to use modules and software from specialist companies rather than develop their own solutions.
The question of range is moot anyway as the range of any radio system is dependent upon a whole range of external factors. Such as the antennas and their environment, what, if anything, is in the way between transmitter and reciever, and what multipath reception is like.
Julie