I heard that they were waiting for the patent holder's patent to expire, but just wanted to confirm.
Basic transponder technology is old, predating GPS. Basic transponder operation (also called Mode A) only sends the programmed code, which can easily be represented as four octal digits. (In fact, before that, only two octal digits worth of data were programmed and sent.)
Later, a representation of the aircraft's (transponder's) altitude was encoded and sent along with the programmed code. This is Mode C.
As noted in the comments by Ron Beyer, the new transponder standard (the ADS-B Out technology) can send the GPS location information.