4 ms·

With a deal like that what incentive does Mozilla have to not walk away if someone buys Yahoo? They'll get $1.1 billion dollars for free.

Sanddancer 10y ago
It means having to court a new search engine provider for a revenue stream after those three years are up. Such a deal may not be as favorable for them as an agreement to stick around partnered with yahoo.
- cdnsteve 10y ago
  After leaving Google though, what else is there for Mozilla (after Yahoo)? I seems apparent that these search deals are no longer a viable source of income for the company, future funding might become problematic. I love Mozilla, they have smart folks there so I'm sure they will work it out.
  - rockdoe 10y ago
    Bing? But yeah lack of competition in that space is an issue. Search is still hugely important.
  - pachydermic 10y ago
    Duckduckgo? Don't know how much cash they have to throw around, though. Certainly not as much as Yahoo or Google, but maybe it'd be enough? I hope so, anyways.
    - Macha 10y ago
      I don't know anything about the inner workings of DDG, but I'd have to assume $1m/yr would be a very large outgoing for them, never mind the $300m/yr of Google or $375m/yr of Yahoo.
    - icebraining 10y ago
      I don't think it's anywhere near; DDG probably makes somewhere in the single digits millions per year, while Mozilla earns hundreds of millions from these deals. As a comparison, DDG is serving about 10M searches/day. Google serves that amount every 5 seconds.
  - emitstop 10y ago
    Is there any reason they can't just go back to Google? I thought they only switched to Yahoo because the contract was up and Yahoo offered a deal they couldn't walk away from.
    - Sylos 10y ago
      No, they definitely could go back to Google. Problematic is just that while Google will probably pay, there's now essentially a third of the competition for that spot gone, so Google will have to pay significantly less.
      - justinlardinois 10y ago
        Never mind also that Chrome has made leaps and bounds. I don't know the details of the history of Mozilla and Google's partnership, but featuring prominently in a major browser was probably a lot more valuable to Google back when Google didn't have a browser of its own.
      - zanny 10y ago
        It is also a bit of a conflict of interest on Google's part to support Mozilla. They have a competing app ecosystem, and while supporting the Firefox Marketplace and Chrome App Store are actually relatively simple for HTML5 apps, they probably would rather not have the competition at all.
        zabraxias 10y ago
        The only conflict of interest left is the browser itself. A $300M deal for Google to keep a competitor's searches their way is almost too cheap.
  - mosburger 10y ago
    Yandex? Baidu? (Somewhat serious here)
    - SXX 10y ago
      Yandex have market cap less than $7B and they simply don't have money to expand worldwide.
rockdoe 10y ago
Excellent question. If they buyer is interested in maintaining a search presence, they'll almost have to negotiate an extension right away?
amenod 10y ago
The buyer will surely negotiate with Mozilla before they buy Yahoo and get a commitment from them (which might be worth extra $). That, or they will see it as sunk cost. But Mozilla might have a bit of PR challenge on its hands if they walked away... :-)
- k__ 10y ago
  challenge? they would finally be free...
  - rockdoe 10y ago
    Free to do what, though?
    - SixSigma 10y ago
      Spend $1bn
- the_watcher 10y ago
  Yea, seems by far most likely that whatever buyer emerges will negotiate directly with Mozilla to sort this out prior to the actual sale
rbobby 10y ago
Meh. I would expect that if Mozilla did not put in reasonable effort at "making things work" with the new owners the new owners would sue. Not sure on what grounds... but with a billion on the line spending a few tens of millions fighting a longshot is likely worth it.
smacktoward 10y ago
The point of a deal like that is to reassure Mozilla that Yahoo is not going to sell, at least not during the term of the agreement. It provides the party on the other end with a sort of insurance policy -- "we can show you how serious we are about not doing this thing you're afraid of by requiring ourselves to feel some serious pain if we ever actually do it." This insurance policy is both literal -- if Yahoo does sell, whatever hardship that causes Mozilla will be eased considerably by all that cash -- and figurative -- Yahoo's willingness to offer such a payout should a sale happen signals to Mozilla that Yahoo's leadership is probably not actively pursuing a sale. (Or at least wasn't, at the time the deal was made.) The theory on the latter part being that no rational person would make that offer if they thought a sale was in any way likely.
Spooky23 10y ago
The buyer gives them more money. "Here's a payment and an increase in share worth $1.3B. If that's not acceptable, we'll publicly announce this afternoon that we're not renewing our deal."

Sanddancer 10y ago

It means having to court a new search engine provider for a revenue stream after those three years are up. Such a deal may not be as favorable for them as an agreement to stick around partnered with yahoo.

cdnsteve 10y ago
After leaving Google though, what else is there for Mozilla (after Yahoo)? I seems apparent that these search deals are no longer a viable source of income for the company, future funding might become problematic. I love Mozilla, they have smart folks there so I'm sure they will work it out.
- rockdoe 10y ago
  Bing? But yeah lack of competition in that space is an issue. Search is still hugely important.
- pachydermic 10y ago
  Duckduckgo? Don't know how much cash they have to throw around, though. Certainly not as much as Yahoo or Google, but maybe it'd be enough? I hope so, anyways.
  - Macha 10y ago
    I don't know anything about the inner workings of DDG, but I'd have to assume $1m/yr would be a very large outgoing for them, never mind the $300m/yr of Google or $375m/yr of Yahoo.
  - icebraining 10y ago
    I don't think it's anywhere near; DDG probably makes somewhere in the single digits millions per year, while Mozilla earns hundreds of millions from these deals. As a comparison, DDG is serving about 10M searches/day. Google serves that amount every 5 seconds.
- emitstop 10y ago
  Is there any reason they can't just go back to Google? I thought they only switched to Yahoo because the contract was up and Yahoo offered a deal they couldn't walk away from.
  - Sylos 10y ago
    No, they definitely could go back to Google. Problematic is just that while Google will probably pay, there's now essentially a third of the competition for that spot gone, so Google will have to pay significantly less.
    - justinlardinois 10y ago
      Never mind also that Chrome has made leaps and bounds. I don't know the details of the history of Mozilla and Google's partnership, but featuring prominently in a major browser was probably a lot more valuable to Google back when Google didn't have a browser of its own.
    - zanny 10y ago
      It is also a bit of a conflict of interest on Google's part to support Mozilla. They have a competing app ecosystem, and while supporting the Firefox Marketplace and Chrome App Store are actually relatively simple for HTML5 apps, they probably would rather not have the competition at all.
      - zabraxias 10y ago
        The only conflict of interest left is the browser itself. A $300M deal for Google to keep a competitor's searches their way is almost too cheap.
- mosburger 10y ago
  Yandex? Baidu? (Somewhat serious here)
  - SXX 10y ago
    Yandex have market cap less than $7B and they simply don't have money to expand worldwide.

rockdoe 10y ago

Excellent question. If they buyer is interested in maintaining a search presence, they'll almost have to negotiate an extension right away?

amenod 10y ago

The buyer will surely negotiate with Mozilla before they buy Yahoo and get a commitment from them (which might be worth extra $). That, or they will see it as sunk cost. But Mozilla might have a bit of PR challenge on its hands if they walked away... :-)

k__ 10y ago
challenge? they would finally be free...
- rockdoe 10y ago
  Free to do what, though?
  - SixSigma 10y ago
    Spend $1bn
the_watcher 10y ago
Yea, seems by far most likely that whatever buyer emerges will negotiate directly with Mozilla to sort this out prior to the actual sale

rbobby 10y ago

Meh. I would expect that if Mozilla did not put in reasonable effort at "making things work" with the new owners the new owners would sue. Not sure on what grounds... but with a billion on the line spending a few tens of millions fighting a longshot is likely worth it.

smacktoward 10y ago

The point of a deal like that is to reassure Mozilla that Yahoo is not going to sell, at least not during the term of the agreement. It provides the party on the other end with a sort of insurance policy -- "we can show you how serious we are about not doing this thing you're afraid of by requiring ourselves to feel some serious pain if we ever actually do it." This insurance policy is both literal -- if Yahoo does sell, whatever hardship that causes Mozilla will be eased considerably by all that cash -- and figurative -- Yahoo's willingness to offer such a payout should a sale happen signals to Mozilla that Yahoo's leadership is probably not actively pursuing a sale. (Or at least wasn't, at the time the deal was made.) The theory on the latter part being that no rational person would make that offer if they thought a sale was in any way likely.

Spooky23 10y ago

The buyer gives them more money. "Here's a payment and an increase in share worth $1.3B. If that's not acceptable, we'll publicly announce this afternoon that we're not renewing our deal."