Why is modem needed?

If you're talking about a Cable Modem, which I guess you are since Modems are not really used anymore.

A cable modem is...really important.

A cable modem is the door for the internet signal. The signal goes from your ISP, to the Cable modem and then to your computer, it gets the IP's from your ISP, it determines the speed you should have and it converts the signal from the Coaxial cable to something called Internet.