Mozilla annual report shows risky Google dependency now risky Yahoo! dependency

Revenue up 4.9 per cent, but browser market share shrinking

Firefox logo

The Mozilla Foundation has published its 2014 annual report and while revenues are up, the numbers show the outfit is now very dependent on Yahoo! for future income and has declining market share.

The good news is that revenue for 2014 was up by US$15m to $329.5m, a nice jump.

The bad is that Firefox, which generates 90 per cent of that revenue, is losing market share. As the graph below shows, Firefox's share across desktop, tablet and mobile has sunk from 11.97 per cent to 9.53 per cent from October 2014 to October 2015. While the population of internet users is growing, Firefox is likely being used by fewer people and that means fewer searches and lower revenues.

Mozilla knows it's in a tight spot: the report's section on risks notes that it “Mozilla entered into a contract with a search engine provider for royalties which expired in November 2014. In December 2014, Mozilla entered into a contract with another search engine provider for royalties which expires December 2019.”

“Approximately 90% of Mozilla’s royalty revenues were derived from these contracts for 2014 and 2013,” the report says, elsewhere adding that royalties are “... determined by the search and information providers based upon end user activity or as contractually agreed to.”

It's not known if Mozilla's deal with Yahoo! includes a flat rate of contributions, a pay-per-search arrangement or some combination of both. Yahoo! says it is chuffed to be Mozilla's search partner. Just how chuffed if Firefox becomes a less-effective funnel is anyone's guess. The same goes for Mozilla's search partners beyond the United States, such as China's Baidu and Russia's Yandex.

We won't know how the Yahoo! deal is working out for a year or so: the outfit's books match the calendar year but as this story shows its reports emerge at a leisurely pace.

Another thing we can learn from the books is that Mozilla's in decent shape. It spends less than it earns and has $266m in assets. ®

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