Variable fan speed and furnace modulation can work independent of each other.
Furnace modulation typically requires the manufacturer’s proprietary communicating thermostat to utilize this capability. Some manufacturers may still provide the option to connect a non-communicating thermostat and this will be evident as the furnace control board will have the thermostat wire terminals R, C, W1, W2, Y1, Y2, G. If so, it will also require adjusting a DIP (dual in-line package) switch setting to put it into a non-modulating mode.
Management of variable fan speed is handled by a built-in controller that is part of the furnace control system. The controller will determine the rate of revolutions per minute (rpm) based on the control signals coming from the thermostat. Depending on heating modes, cooling modes or fan only mode, the controller has been pre-programmed to operate at a specified rpm +/-10% based on environmental conditions with the furnace ducting system.