Phonetics is hard. Especially with ambient noise, echo and such. I had a conversation with one of the speech engineers when I worked at a speech recognition company and the level of detailed problems to solve was impressive. Totally made sense after talking about it, but things I would not have thought about before.
I'd imagine the next thing to come in this area that would really make an improvement is an "on person" microphone. Maybe it's a pen in your pocket, or some kind of vibration detection (that could pick up the wearers voice), that would then allow some improvemnts in the domain of "who is talking" and how well the voice is processed.