This is great for Mozilla. As Jay Lyman, senior open-source analyst for 451 Research, said this is "certainly good news for Mozilla and Firefox and it buys them more time to find other sources of revenue beyond Google's search advertising. However, that has long been and continues to be a challenge. At the same time, Firefox and Mozilla are facing intense competition on all fronts, particularly from Google with Chrome. Mozilla's wise moves toward mobile computing may be intensified or expedited, but the organization faces significant competitors there too."
For now though, it's all good for Mozilla. We don't know how the details of how Mozilla almost tripled its income were hammered out yet, but we do know that Mozilla played Google off against both Microsoft and Yahoo. While both search giants will still be listed as options for Firefox, the all important default search engine will remain Google.
Now the question is: What will Mozilla do with its new-found riches? A good guess, to borrow Microsoft's Steve Ballmer's favorite phrase, is: "Developers! Developers! Developers!"
In the last three years, Mozilla has ratcheted up its software development spending enormously. The Software Development line in Mozilla's financials reads:
2008: $31.3 million
2009: $40.2 million
2010: $62.8 million
But where exactly will this money go? Mozilla has declined to answer my queries, but given their recent work, it's not too hard to guess where their money will go.
First, Mozilla has been pushing out Firefox releases at a dizzying pace. And, as the emergency bug fix release of Firefox 9.01 just showed, sometimes Mozilla has been releasing their flagship Web browser too fast for its users own good. With more resources, Mozilla can, and should, do a better job of quality assurance.
So, what I expect to see is stronger Web browsers on the PC and additional innovation for the growing smartphone and tablet market. I see Mozilla and Google both winning from this deal. For what still amounts to little money for Google, the search giant put more pressure on Microsoft and Mozilla gets more money than the company has ever seen before. Microsoft is the big loser, but Yahoo and all the smaller Web browser companies can't be happy either.