The recent resurgence in web browser development has been marked by a number of advances, to a lesser degree with products than with the continuing evolution of portable-but-connected devices:
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On the desktop
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Google's (WebKit-based)
Chrome
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On devices
Without a doubt, the advancements made by Firefox 3 showed Microsoft that it had rested on its laurels for too long: FF3 is fast, capable, and chock full of usability nuances that make it a fantastic browser, not to mention the fact that it is cross-platform (which is becoming increasingly relevant) and Open Source (meaning that its continuing improvement is virtually inevitable). Microsoft knew how to wage war with Netscape, but this endless-supply-of-free-development-resources makes Firefox a troublesome competitor. Rationally speaking, no matter how many developers Microsoft throws at IE, Firefox can garner more and execute more quickly. Ironically, it is the very fact that IE is so entrenched in the space that hinders its advancement: The IE8 team has been up to their earballs trying to wrestle with 10 years of legacy compatibility.
This legacy compatibility issue is, in my opinion, what continues to plague Microsoft at all levels of its game... they simply can't abandon old code because millions of in-use applications will break and its customers (who have invested billions in developing those apps) might look at other platforms more seriously. Apple did it with OS X and it could, because, hey, 2.5% of the market can deal with an evolve-or-die upgrade. Mozilla did it with Firefox née Netscape by the same rationale. But Microsoft can't, not without literally splitting its client base and risking significant forfeiture in the process.
So IE is doomed to be slower, but more broadly compatible with content (especially apps) than Firefox. Firefox will likely continue to gain market share on the consumer desktop, but it'll be a long time before all of those enterprise apps are compatible. That, itself, is a chicken-and-egg problem: Enterprises won't deploy FF because their line-of-business apps only work with IE, and the developers of those LOB apps have no compulsion to be FF-friendly since its clients all have IE.
And then there was Chrome.
Chrome irks me. Not because competition is bad (although the subjective interpretations of the standards in this space have always been a problem), but because of Google Gears. I'm all for Google making a public AJAX library: that's cool, just like Microsoft, Yahoo!, Script.aculo.us, and so on. But now they've integrated it into the browser. Hey, Microsoft's ActiveX pioneered the world of custom extensions and proved that it is a bad thing... are we going to see sites now that don't work without Chrome's integration? Is that really okay by everyone?
What can I say, I'm not a Google zealot by any measure for a number of reasons. Yes, they make a great search engine (still the only one I use), but the degree to which the bulk of the industry fawns over them is ridiculous... They have the worst case of Not Invented Here syndrome I have ever seen, even surpassing Microsoft or Sun. And the money to do just about anything they want...
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GMail. Compete with Hotmail and Y!Mail for the in-email ad space. Got it.
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Google Apps: Hm, that's a lot of dev for occasional ad space and not much of a revenue plan. But, hey, maybe you've got something.
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Google drops its OEMs and brings in-house a hardware team that designs and builds its servers,
possibly building their own 10GbE switches, fiber equipment, and they're possibly snapping up dark fiber and laying their own cable.
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Google Base, Earth, Sky, Ocean, Checkout, Notebook, Picasa, Reader, SketchUp, Google's
bid for a cellular band, Google's
custom Silverlight (which is ironic to say the least)... and the possibility that Android/Chrome are
destined for the desktop.
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And its outliers: Postini, Orkut, Knol, GrandCentral, Marratech, Google Wifi, Dodgeball, Jaiku, GreenBorder, and Zingku.
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... uh, what? If any other company, especially Microsoft, had this broad a slate of ambitions, they'd be tarred, feathered, and tried swiftly as madmen in the court of public opinion.
But cute'n'fuzzy Google? Nahh, they're snapping up every inch of valuable data for proprietary lock-in because they love us.