Larry -
I assume you are asking
How it works, and not
How well it works.
If you could apply the left and right trailer brakes independently, this would be the best way to do trailer sway control. But this isn't possible on most trailers - left and right brakes are always applied equally.
However, for the last few years, many tow vehicles have some sort of Stability Control built in. The Ford version is called Roll Stability Control (RSC). These systems work by applying the tow vehicle's left and right brakes independently when the motion of the tow vehicle calls for it. So if the trailer begins to sway, it yanks the tow vehicle around, the RSC senses the tow vehicle motion and corrects it, which stops the trailer sway. As I think you noted, this is an after-the-fact correction - it doesn't do anything until sway has already started. Like friction sway control, it is not as good as preventing sway in the first place.
There is a short article on eTrailer.com that mentions some of these same thoughts.
https://www.etrailer.com/question-61877.html
I have Built-In Sway Control on my F-150. Does it work? I don't know. I've never had any sway control on any of my tow vehicles, with or without RSC, and I've never experienced sway. TMs are designed not to sway.
Bill