Firefox: Mozilla’s Deal With Google Has Expired; How Will Firefox Survive?

Tweet

Mozilla Firefox has seen a decline in market share, amid Google Chrome’s rise in popularity. Now, as Mozilla’s search deal with Google has expired, there is question whether Mozilla’s business will remain sustainable. Will Microsoft/Bing step in to help save Firefox?

Mozilla has been bleeding market share lately, with news that Google Chrome has overtaken Firefox in terms of U.S. traffic. The company has also been bleeding talent, particularly with a key engineer, Mike Shaver, leaving in September. But the biggest threat to Firefox’s sustainability is perhaps the possible loss of its key revenue partner, Google.

In Mozilla’s most recent financial statement prepared last August, it mentions the need to renew a search contract with a search company, which it doesn’t mention by name (but which is quite obvious, given Mozilla’s history).

The Corporation has a contract with a search engine provider for royalties which expires November 2011. Approximately 84% and 86% of royalty revenue for 2010 and 2009, respectively, was derived from this contract.

ZDNet‘s Ed Bott has made an analysis of how Mozilla has worded its statements, comparing these to the 2009 and 2010 setting, when the Google-Firefox deal had been renewed. Back when the original three-year agreement was made, Chrome was still being conceptualized by Google, and no one had an inkling that the browser would grow so fast.

Another point of contention is the viability of extensions and apps. When Firefox first launched, Mozilla highlighted the active developer community, which produced extensions and plugins. But the content-producing and consumption environment today involves apps — whether for smartphones, tablets, and desktop computers.

With these developments, is the end for Mozilla Firefox in sight?

There are speculations that Mozilla might be looking into partnerships with another major search provider, particularly Bing. Firefox is certainly a big competition to Internet Explorer, but Bing could also use the extra leverage from Firefox’s 25% or so market share. Microsoft is already promoting Firefox with Bing. Is this any indication that a bigger partnership is in the works?

What’s clear at this point is that Firefox has completed a cycle of rising up from being the small guy to one of the more dominant players in the market, and is now seeing competition from another small guy that is on its way to being a major player — in terms of numbers — very much like itself. The question here is whether Mozilla will get enough financial backing to support Firefox moving forward.