It appears that the next version of Internet Explorer (doubtlessly IE 7) will come with tabs, just like Firefox. Whilst Microsoft has been keen to emphasise notions of compatibility and security in this new browser (not surprising, given the sheer number of security flaws that have been found and reported in IE in just 2005 alone) it appears that they have also been keen to add tabs into the mix as well. Tabbed browsing is, in my opinion, something that makes Firefox better than IE, and is a feature that should have been a part of it ages ago.
Yes, IE7 has tabs.
In general, I think tabs are a great idea. I liked them a lot in Office dialogs and in Excel in the early 90's. (I used to work on Office, and I admit we almost added tabs to Word at one point.) I like them in Visual Studio. I think, as an industry, we have a ways to go in refining the experience, consistency, and value of tabs.
The tabbed browsing experience in the upcoming IE7 beta is pretty basic. Expect additional end-user functionality to come in after the beta.