This invention is in the Wonkavision studio (also known as the white room). This invention is used for instead of broadcasting images from a screen it broadcasts real life objects to your television set. Willy Wonka tests his invention by using oversized Wonka chocolate bars. The object that the machine is broadcasting needs to be sized right for it to work.
Mike Teavee ends up leaving the tour in this scene because of his love of electronic devices and being broadcasted into the screen at a normal size. He is needed to go to the taffy pulling room to get pulled to a normal size.