They have not only made it the native image format of the Office97 application suite but have also repeatedly promised to put it into Internet Explorer. Assuming they do, Netscape is almost certain to follow suit. At that point PNG should enjoy a real burst of WWW interest and usage. However, support by five or six other Linux web browsers isn't bad, and even mainstream applications like Adobe's Photoshop now do PNG natively. More are showing up every week.
Life is good.
JPEG, the other required VRML 2.0 image format, doesn't support transparency. Indeed, the only open issue is support for animations and other multi-image applications. GIF format a huge resurgence in popularity. A couple of special purpose MNG implementations have been written, as well. But MNG is too late for the VRML 2.0 spec, and despite some very compelling features, it may never be perceived as anything more than PNG's response to GIF animations.