Thats right, quoting this item from the IE Blog, it seems that Microsoft is gearing up for the competition by Firefox

First, some basics: we're committing to deliver a new version of Internet Explorer for Windows XP customers. Betas of IE7 will be available this summer. This new release will build on the work we did in Windows XP SP2 and (among other things) go further to defend users from phishing as well as deceptive or malicious software.

Why? Because we listened to customers, analysts, and business partners. We heard a clear message: "Yes, XP SP2 makes the situation better. We want more, sooner. We want security on top of the compatibility and extensibility IE gives us, and we want it on XP. Microsoft, show us your commitment."

At this moment, all I can say is I will have to see it to believe it. And by that I don't mean the actual delivery. I know Microsoft is going to get out the new version. But I want to see is whether they are really listening and are going to make the browser more secure and standards compliance. If Microsoft can really deliver on this one, then it make life much easier for us.