by 
The Curious Bag
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Most modern automatic transmissions use some sort of computer control system. These systems are used both to monitor transmission condition and to control several shift parameters.
History
The first known instance of electronic transmission control was by Chrysler in the late 1980s. This controller was only used to alter shift firmness under acceleration.
Control
Electronic transmission controllers are used to control, among other things: shift points, shift firmness, torque converter lock-up and overdrive engagement.
Monitoring
These units monitor nearly every aspect of transmission condition, including fluid pressure, temperature input/output speed and vehicle speed.
Inputs
Transmission controllers require a number of outside inputs to function. These can include the throttle position sensor, wheel speed sensor and traction control system.
Networking
The extended network of the average TCM can include neutral safety switches, brake lights and cruise control.
Failure
Aside from manufacturer defects, one of the main causes of TCM failure is exposure to transmission fluid, which can leak into the computer's circuitry on some cars.
Source:
Resource:
TCM Malfunction in an Audi (Video)
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