It's true that Firefox has typically been playing catch up throughout its lifespan. However, in the last 18 months, it has been seriously lagging behind other browsers (IE aside). Process separation, general speed, stability, memory fragmentation, etc.
This meme about Firefox memory fragmentation just won't die! Firefox 3.0.x you could still claim that Firefox was sucking down more and more memory as pages got visited. With 3.5.x, you can kiss that problem pretty much goodbye - Firefox returns more memory back to the system than any competing browser.
And Firefox isn't the largest memory consumer here either - that prize probably goes to Chrome, simply because one-tab-per-process is inevitably a heavier memory requirement.
Firefox stability is still a minor issue. However, it's stable enough that I get about 1 crash every three days, which is well within my tolerance level (14 extensions, 11 plugins). Tools like abrt provide a decent mechanism for informing the necessary bug trackers.
Speed-wise, Firefox devs know they are in a race with Chrome. 3.6.x looks like it will be faster than 3.5.x by a fair margin. Project Electrolysis stands to improve matters further. I'm all for competition - keeps everyone working on the issue.
Give me a plugin sandbox so that Flash trapping doesn't take out the page and I'll be content.
Cheers,
Toby Haynes