Mozilla dependent on Google
THE MOZZERELLA Foundation has revealed that if Google backs out of its arrangements in favour of its own browser, the Open Sauce outfit will be toast.
In its financial statement for 2007, the foundation said that while revenues for the organisation behind the open-source Firefox browser were up 12 percent to $75 million, the company was making most of its cash from search-related royalties from Google.
This made 88 percent of the total, or $66 million while another $2 million or so came from other search engines.
What must be alarming for the bean counters is that Google's overall percentage of Mozilla’s revenues is even bigger than it was in 2006, when it accounted for 85 percent.
While Mozilla has three years worth of contract with Google left to run, it does put the Open Sauce browser in a vulnerable position.
What could trigger Google falling out of love with the Open Sauce outfit? Mozilla is being audited by the IRS and its non-profit status is in question. It is arguing that the cash it collects from Google should be treated as royalties, and thus not count as revenues under the tax code.
If it loses its status it will have to stump up an extra $100,000 for tax and be classed as a private foundation. While that will not cost it much, if Google has been claiming tax relief on the money that it gives Mozzarella it will cost the search empire a lot of dosh in tax relief. This might encourage it to develop Chrome. µ
L'Inq
Techcrunch
Share this:
Business Intelligence Software
Customer Relationship Management (CRM)
Enterprise Accounting Software
Enterprise Resource Planning (ERP)
Enterprise Systems Management
What I don't get is why an open source foundation needs 75 million dollars of revenue. The whole idea of open source software is people developping it for nothing?? What do they do with 75 million dollars? setting up a website and structuring it and lots of meetings?? Boy do I want to be the website host and after meeting caterer for the foundation.
fred - you've got it all wrong. Free software is about freedom not price. Very few free software developers give away their work - many get a paycheck from companies like Redhat, Novell, HP, IBM, Sun and yes, Mozilla. Others get paid in less tangible ways like experience either as part of college or less orthodox methods of getting credentials to get a paying a job. The last, and probably largest, group of people who work on Free software are those who are "scratching an itch" - they need a tool to perform a task as part of their regular day-job so they take a piece of Free software, enhance it to do the work they need, and then give the enhancements back to the project to maintain for them. One way or another, EVERYBODY gets paid. Free software ain't communism, if anything, it is the purest form of capitalism ever.
Still, what on earth are they doing with 80 million dollars a year? Where does all this money go. I don't get it. You can hire 1000 full time engineers with that kind of money.
Google will buy Mozilla.
It appears they spent about $33M this year and are holding onto the rest. Mitchell Baker, the MF Chairperson, describes the MF expenses in a blog post here... http://blog.lizardwrangler.com/2008/11/19/sustainability-in-uncertain-times/ The expenses aren't broken out but from the document "2007 audited financial statement for the Mozilla Foundation" (Warning PDF) found here... http://www.mozilla.org/foundation/documents/mf-2007-audited-financial-statement.pdf you can see that they spent approx. $20.7M on software development, $6.3M on marketing, $5.1M on administration and $1.1M on services. It also reports $82.2M in net assests.
Your math is off, unless you expect to hire engineers in the 3rd world. Rule of thumb in the USA is that carrying costs (employment taxes, retirement, health insurance, equipment, facilities, etc) are equal to salary - so unless those engineers are working for less than US$30k/yr, it is unlikely that Mozilla could hire 1,000 of them. Then there is the cost of additional facilities like data centers plus bandwidth, promotion/advertising, lawyers, etc. The great thing about the Mozilla Foundation being a non-profit is that all of their financials are audited and available online, just google for "Mozilla Foundation." You will find that last year they saved roughly $25M of their income and spent roughly $21M on software development, $17M on taxes, $6M on advertising and $5M on management and administration.