It may be hard to believe, but the first iteration of Internet Explorer on Macintosh (back on System 8) was __solid__. IE, at least on PowerMacs, was way faster and more reliable than either NCSA Mosaic or Navigator.
That makes it sound like Netscape had no say in the matter. Netscape sold itself to AOL.
Similarly, if the D compiler crashes when compiling a D source file, it's the D core team's fault.
IE4 is where ActiveX and browser bloat started to become more obvious, then IE5 was an improvement again.. but we were only a short time from the launch of what would become Firefox. By that point, people were tired of the constant IE issues.
Commercial users were paying for Netscape in 1995. It was only free for personal use. Even articles from 1996 mention the cost of Netscape as $49. [1]
So at least part of the reason IE displaced Netscape was that it was free for enterprises. And Netscape was not, until it was too late.