I saw several "Is IE dead?" blogs and most recently DonXML's blog about this subject and I really think this discussion is not focussing on the real issue.
What's the problem with current browsers? It's not that they can't render version ABC of a given HTML, XML or XSLT variant. The problem is that they are used as application-GUI hosts while they are intended to be used as stateless viewers of information. Through an evolutionary process, Andreessen's tool to view hyperlinked texts has become an interactive viewer of a GUI for applications but still does that using the same old techniques. Which is a result of the way HTML works, and all mark-up languages in that respect.
I read all kinds of thoughts how and why IE should evolve but it really shouldn't. It should be put to rest, and the focus should be moved to an application which is already at our desktop: the CLR itself. It's a waste of energy when you are trying to re-invent the wheel that is already available: winforms. The majority of web-applications use cumbersome HTML-forms to try to build a workable GUI, while a winforms developer can do that with ease using the winforms glyphs and controls. If there was a way to run a GUI using winforms on the desktop of the website visitor, you can build a rich and powerful GUI with common technology which doesn't suffer from the fact that there is no scripting available, all HTML form glyphs are text based and other nasties related to HTML (or XHTML for that matter) which are totally avoidable when you use a decent GUI framework, like winforms.
I've been developing websites and webapplications since 1994 (ah, those good ol' days without images on pages) and I never understood why on earth a browser is used to host a rich GUI, because HTML is not meant for that, it lacks serious building blocks available in every GUI toolkit on the planet (even the console library Cursus has them!). Trying to keep it alive for webapplication GUI's is not the way IE should be evolved, IMHO.
The problem is platform independence. When Mono sees the light of day, a CLR with decent winforms is available everywhere. It should then be possible to run any decent winforms GUI frontend for any webapplication out there on every decent system and OS. IE as an application is then not needed anymore, the browser is then obsolete.
HTML, or its markup successor, will not go away of course. It will be rendered by components embedded in other applications, like helpviewer, blog readers and other tools. Such a component can be embedded in winforms as well, as a control.
The concept of the 'browser' is a concept of the past. Let it rest, let it die in peace, it's about time users move on to richer environments and technologies which truly connect user with application, no matter what type of connection (local system pipe/lan/wan/Internet via modem/ADSL/WiFi, you name it) is used and whatever flavor of browser and client side settings.