The concern about the Mozilla-Google relation is more focused on what would happen if Google walked away and chose to create its own browser, or back another. Their agreement is set to expire next November, the foundation announced within its financial statements
Only a couple of years ago, Firefox was the little browser that could – an open-source program created by thousands of contributors around the world, without the benefit of a giant company like Microsoft to finance it.
Today, Firefox, which has prospered under the nonprofit Mozilla Foundation, has grown to be the largest rival to Microsoft’s Internet Explorer, with 15 percent of the browser market worldwide and higher percentages in Europe and among tech-savvy users. It has about three times as many users as the Apple Safari, whose new version is the first to work on PCs.
In trying to build on this success, the Mozilla Foundation has come to resemble an investor-backed Silicon Valley start-up more than a scrappy open-source project. Using a for-profit subsidiary, the Mozilla Corporation, the foundation has generated tens of millions of dollars in revenue in royalties from search engine companies that want prominent placement on the browser. As a result, the foundation has built a war chest to compete against the giants and has, at least temporarily, moved away from the typical activities of a nonprofit organization.
Looming over all of this competitive planning is Google, the search engine giant that has been writing most of the royalty checks that finance Firefox. That contract expires next year and no one knows whether Google will continue as an ally – or possibly emerge as a challenger.
There are many examples of businesses that have been created to help service open-source projects – like Red Hat was for Linux – but Siobhan O’Mahony, an assistant professor at the University of California, Davis, School of Management, calls Mozilla “the first corporate open-source project.”
According to Mozilla’s 2006 financial records, which were recently released, the foundation had $70 million in assets, largely invested in mutual funds, and last year collected $66 million in revenue. 85% came from a single source – Google. But, despite a pledge to use Firefox revenue to support new open-source projects, the foundation gave away less than $100,000 in grants, according to the audited statement, or $287,000, according to Mozilla, in 2006. In the same year, it paid its chief executive, Mitchell Baker, more than $500,000 in salary and benefits.
The rise of Firefox can be seen as an extension of the Netscape-Microsoft battle of the mid-1990s. After Microsoft had largely wrested control of the market, Netscape decided in 1998 to release its code to the public, and immediately developers took up the challenge.
When the extent of the financial connection between Mozilla – which proudly points to its community of tens of thousands of voluntary developers, testers and “evangelizers” – and Google was first revealed about a year ago, the question was whether Mozilla was acting as a Google proxy in its larger wars with Microsoft and others.
Wladimir Palant, a longtime contributor to Firefox who administers the popular Adblock Plus add-on that removes ads from Web pages, said he was pleased that the foundation had so much money saved up. He advised that it “save some of the money for later.”
A Google spokesman issued a statement saying: “Mozilla is a valued business partner because many users utilize Firefox to access Google products and services.”
“We’re living in a cold war between open and closed systems, and Google is happy to lend support to entities that it sees as allies,” he said.