The aims of this paper are to (i) provide a brief history of cochlear implants; (ii) present a status report on the current state of implant engineering and the levels of speech understanding enabled by that engineering; (iii) describe limitations of current signal processing strategies and (iv) suggest new directions for research. With current technology the "average" implant patient, when listening to predictable conversations in quiet, is able to communicate with relative ease. However, in an environment typical of a workplace the average patient has a great deal of difficulty. Patients who are "above average" in terms of speech understanding, can achieve 100% correct scores on the most difficult tests of speech understanding in quiet but also have significant difficulty when signals are presented in noise. The major factors in these outcomes appear to be (i) a loss of low-frequency, fine structure information possibly due to the envelope extraction algorithms common to cochlear implant signal processing; (ii) a limitation in the number of effective channels of stimulation due to overlap in electric fields from electrodes, and (iii) central processing deficits, especially for patients with poor speech understanding. Two recent developments, bilateral implants and combined electric and acoustic stimulation, have promise to remediate some of the difficulties experienced by patients in noise and to reinstate low-frequency fine structure information. If other possibilities are realized, e.g., electrodes that emit drugs to inhibit cell death following trauma and to induce the growth of neurites toward electrodes, then the future is very bright indeed.