Microsoft has basically realized that if they want to remain competitive, they now have to update frequently, and actually release acceptable products. Similar to Chrysler/Ford/GM - their sales didn't drop that much, but it was enough to throw GM and Chrysler into bankruptcy, and Ford damn close. Microsoft basically could not wait any longer - it was getting to the point where schools and businesses were now imaging computers with Firefox and other Microsoft alternatives.
Just think about it: It was over 5 years between IE6 and IE7. A little over 2.5 years between IE7 and IE8, and it looks like about 2 years between IE8 and IE9. Windows 8 is scheduled somewhere in 2011-2012.
You get the idea. Microsoft is being much much more competitive than they have been in probably the past decade. You'd have to be a fool to ignore their recent strides.