From a user point of view: Nobody understands it. One of the questions I get constantly is what is Trackback? And I get this questions from both new and veteran bloggers.
From a technical point of view: There's no authentication and no way to eliminate trackback spam.
What people want to really know is this: who's linking to my blog (to individual blog posts, to the the home page, to anywhere on their site), website or mentioning my name or company? This is what people want to know (and yes I know Trackback can be used for other purposes like telling your blog what MP3 you are playing at the moment but only geeks use Trackback for that!). They don't care about Trackback and if there had never been Trackback, this is still what people would want to know.
PubSub does this particularly well (usual disclaimer: I am friends with the CEO and CTO of PubSub and you can accomplish almost the same thing with Feedster, Technorati et al but in my experience PubSub is the most accurate and timely). With a single search you can tell whether somebody is linking to anywhere in your blog or mentioning your company name or keywords. Very powerful and much more easy to understand and more general than Trackback.
Even though pundits have been saying that trackback is dead, the idea of using Technorati or another external tool to track citations and interactions is just too clumsy for me to accept. The point of trackback is arguably to extend conversations over multiple blogs-which Technorati does-but it has the desireable sideeffect of directly linking to the commenting blog. This removes the middleman, Technorati, and optimizes a readers flow. Instead of having to click on a -read commentary on Technorati- link, wait for and browse the list of commenting blogs, and finally choose an article to view, they travel directly to the commentary. From a user perspective, this is important.