I remember reading this back in the day, but this article has not aged well. Joel is a smart guy, but this advice is frankly ludicrous.
In Joel's world, Apple would have never scrapped Mac OS Classic and launched OS X. And Microsoft would have never scrapped the old DOS underpinnings and started over with the NT kernel.
Starting over happens all the time in software projects, and I'll admit that in many cases it's a waste of time. But quite often, it's an excellent idea. The world changes, and despite what Joel thinks, software really does age.
In the case of Netscape, I would say that their rewrite worked out pretty well. Mozilla was a big jump forward in browser technology, and then Firefox (which itself was a rewrite of Mozilla) has become a truly successful browser.