What I was told when we've installed improved S mode transponder: it transmits 8 characters callsign but there are not many SSR stations in Europe that can read it. We don't have FMS, so callsign is entered via transponder remote control unit (Collins type). There's one extra position on mode selector beyond ALT, labelled FID which is used to enter callsign; three characters for airline code, one blank and four numbers for flight no.