UPDATE: Microsoft's own tests find IE8 faster than Firefox. See links to pdfs here. Independent reports treat the company's tests somewhat skeptically. See here and here.

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I have not tested Internet Explorer 8 — the new version of Microsoft's (MSFT) industry-leading Web browser, which was released here on Thursday. And since Microsoft has made it clear that it has no intention of writing a version for the Apple (AAPL) Macintosh, I may never use it.

However, I've gone through the promotional videos and read some of the early reviews, starting with Walt Mossberg's in the Wall St. Journal, and I gather it's a significant advance over IE7 with some fine new features and none of the obvious flaws Vista had coming out of the box. But it has a fundamental problem. As Walt puts it in the last graph of his laudatory review, damning IE8 with faint praise:

"If it were faster, I would say it was the best browser currently available for Windows." (link)

Microsoft's new browser, according to Mossberg (who is backed up by independent tests  — see here and here), is slower than Firefox, Google’s (GOOG) Chrome, and even the Windows version of Apple’s Safari 4. Which makes me wonder whether IE8 might do for Microsoft's dominant position in the Web browser market what Vista did for Microsoft's monopoly position on the PC desktop.

What am I talking about? Let's go to the pie charts below the fold.

According to Net Applications, which does a pretty good job of tracking who's doing what on the Internet (and reports the results in low-res pie charts), this is what Microsoft's share of the OS market looked like two years ago — a couple months after Vista's worldwide release — and what it looks like today:

In two years, a 93% market share has shrunk to 89%. Moreover, Vista only represents 22% of that market; 63.5% of the world is still using Windows XP. (That green slice, by the way, represents the Mac OS's growing share.)

Now let's look at what has happened to the Web browser market in that same time period.

Here the deterioration is even greater: in two years, IE's market share has fallen from 79% to 67%.

This isn't entirely surprising. Although Internet Explorer enjoys the same built-in advantage as Windows — the software comes pre-installed on every Windows PC sold — there are better Web browsers out there, and it's a whole lot easier for users to switch browsers than to switch operating systems. Hence the growing green (Firefox) and red (Safari) slices in the second chart.

How has Microsoft responded to the challenge? From what I'm hearing, Redmond's strategy with IE sounds a lot like the one that brought the world Windows Vista: Stay focused on your installed base. Pile on the features. Sacrifice performance for new tricks. And act as if the other operating systems didn't exist.

That may produce a pretty good Web browser — and one that's sure to improve over time — but it's not going to keep the barbarians at the gate forever.

UPDATE: The latest data from Net Applications show that IE8 lost market share over the first weekend following its release. One theory is that early adopters are switching back to Firefox. See here.