Another interesting item was linked from the Slashdot post on this , so why eactly was IE7 being released again ;-):

JENNINGS: I read an article coming up here on Firefox (Web browser) and its perceived ability to do this better than you. Is that fair?

GATES: Well, there's competition in every place that we're in. The browser space that we are in we have about 90 percent. Sure Firefox has come along and the press love the idea of that. Our commitment is to keep our browser that competes with Firefox to be the best browser — best in security, best in features. In fact, we just announced that we'll have a new version of the browser so we're innovating very rapidly there and it's our commitment to have the best.