The original sense of this computer term is a copy protection device that attaches to an I/O port of a computer. When a program is run, it checks for the presence of the dongle on the port. The software can be distributed freely, but people have to pay for the dongle to make it work. The concept, while clever, has largely been a market failure, although dongles have filled a small niche by enabling multiple, non-networked computers to share a single software license. The term dates to at least January 1982, when it appears in MicroComputer Printout:
The word “dongle” has been appearing in many articles with reference to security systems for computer software.
The word is most likely a blend of dong and dangle, as it can resemble a penis that hangs off a computer.
A company called Rainbow Technologies, which manufactured dongles, claimed that the term was named for its alleged inventor, a certain Don Gall. This is not true and no such person existed, at least as far as I can tell; the story was simply a fabrication of the marketing department.
A more general use of the term come to my attention a number of years ago in a conversation with my boss where she asked to borrow my dongle, meaning an interface cable for a notebook computer. From a 8 June 2006 alt.pets.rodents.rats Usenet post:
The 6230i supports Bluetooth [...] so a bluetooth-usb dongle for your PC would give your [sic] a wireless means to transfer data. That’s probably the slowest option, but this might not matter for the odd photo or two.
(Source: Oxford English Dictionary, 2nd Edition)
Copyright 1997-2017, by David Wilton