Friday, October 14, 2011

Will Google Continue Subsidizing Mozilla?


For several months now, Google's Chrome browser has been posting larger market share gains, by percentage growth, than open source rivals. In fact, many analysts predict that its market share will overtake Mozilla Firefox's next year. The successful rise of Mozilla’s Firefox browser is a legendary story in the open source community, but many people don't realize that Mozilla gets most of its revenues from Google. In fact, nearly all of Mozilla's revenues come from deals that involve feeding users into search/ad ecosystems. In November of this year, though, Mozilla's deal with Google is up for renewal. Is there a chance that it could go away?

                                                                           

While there is no question that Google still largely supports Mozilla, Mozilla is diversifying its revenue streams.
As ZDNet notes:"Mozilla faces numerous challenges—develop faster, mobile tools and revenue diversification—but the most notable point may be how the organization is stepping up its fundraising game. Mozilla has hired experts who know how to raise money online. These hires, along with the infrastructure that goes with them, could allow Mozilla to diversify its revenue base."
You can check out Mozilla's annual report here.
As it reports: "The majority of Mozilla’s revenue is generated from search functionality included in our Firefox product through all major search partners including Google, Bing, Yahoo, Yandex, Amazon, Ebay and others. Mozilla’s reported revenues also include very important individual and corporate donations and grants as well as other forms of income from our investable assets. "
Even though Google has a big stake in increasing the market share of the chrome browser, it still gets net positives out of subsidizing Mozilla, because the vast majority of Google's business is driven by its search/ad ecosystem, and the more users that get fed into it, the better.

In November, when Mozilla and Google sit down to bargain, there may be changes in terms, but bet on Google renewing its deal once again.

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