In a recent testimony, Mozilla CFO Eric Muhlheim expressed significant concerns regarding the potential consequences of the Justice Department's proposals aimed at curbing Google's search monopoly. The DOJ's recommendations include prohibiting Google from paying to be the default search engine in third-party browsers like Firefox, as well as other drastic measures such as forcing the sale of Google’s Chrome browser and requiring Google to share search results with competing services. Muhlheim described the situation as “very frightening,” highlighting the precarious position Mozilla finds itself in.
The current legal actions stem from a court ruling that deemed Google’s dominance in the search market as an illegal monopoly. This ruling is partly due to exclusionary practices that establish Google as the default search engine on numerous browsers and mobile devices, effectively sidelining competitors. Muhlheim pointed out that Firefox relies heavily on the revenue generated from its partnership with Google. According to him, approximately 90% of Mozilla’s revenue comes from Firefox, with around 85% of that total directly linked to its deal with Google. A sudden loss of these substantial payments could force Mozilla to implement “significant cuts across the company,” which could adversely affect the development and attractiveness of Firefox.
Muhlheim warned that losing the financial support from Google could initiate a “downward spiral” for Mozilla, jeopardizing its ability to invest in product engineering and ultimately threatening the existence of Firefox. This potential outcome could also diminish funding for crucial nonprofit initiatives, including the development of open-source web tools and research into how artificial intelligence can address climate change. He emphasized that without the revenue from Google, Mozilla would face serious challenges to its viability.
Interestingly, Muhlheim pointed out an ironic twist: the very actions intended to break Google’s market dominance could inadvertently reinforce it. He explained that Firefox uses the Gecko browser engine, which is unique in being owned by a nonprofit organization rather than a tech giant. In contrast, the other competing engines are Google’s open-source Chromium and Apple’s WebKit. This distinction allows Firefox to contribute to a more interoperable web, preventing a single entity from monopolizing internet access.
Muhlheim elaborated on the difficulties of replacing Google’s revenue, noting that simply striking a deal with another search engine or negotiating a non-exclusive agreement with Google would not suffice. Mozilla has explored discussions with Microsoft regarding making Bing the default search engine, but he cautioned that without Google’s competitive bidding, the revenue share they could negotiate would likely decrease. Moreover, previous studies conducted by Mozilla indicated that users switching to Bing produced significantly less revenue, reinforcing the challenges they would face if forced to transition away from Google.
During his testimony, Muhlheim noted that while the DOJ’s proposals could potentially lead to the emergence of new quality search engines that could compete with Google, the timeline for this to occur is uncertain. He stated that Mozilla would likely need to make substantial cost reductions and strategic alterations while waiting for this hypothetical future. “We would be really struggling to stay alive,” he warned, underlining the urgent need for a stable revenue model.
On cross-examination, Muhlheim acknowledged that relying heavily on a single customer for the majority of revenue is not ideal. He referenced the Opera browser, which has successfully generated more revenue from advertisements than from search deals. However, he cautioned that adapting such a model for Firefox would pose unique challenges, particularly due to its commitment to privacy and user experience.
Muhlheim stated that Mozilla supports the implementation of choice screens for browsers, which could open up options for users. However, Mozilla does not advocate for a choice screen that would allow users to select a default search engine. He emphasized that while Firefox encourages users to explore various search options—highlighting that “there are a thousand different search points” within the browser—context matters when it comes to providing choices. “The best way to get to choice is not always a choice screen,” he noted.
In a thought-provoking exchange, Judge Amit Mehta questioned Muhlheim about the potential benefits to Mozilla if a search engine that matched Google’s quality and monetization capabilities were to emerge. Muhlheim agreed that such a scenario would be advantageous for Mozilla, reflecting a desire for a more competitive and diverse market landscape.
