Mozilla

The Mozilla Foundation: Achieving Sustainability

January 2nd, 2007

Mozilla is a global community dedicated to improving the Internet experience for people everywhere. We do this by building great software — such as the Mozilla Firefox web browser and Mozilla Thunderbird mail client — that helps people interact with the Internet.

We build great software by building communities. Our software is “open source software.” The source code is available to everyone; as a result people are able to work together and we all share the results of the combined efforts.

The Mozilla project has been building software and communities since 1998.

The Mozilla Foundation recently completed its financial audit and filed its tax returns for 2005. The tax returns should appear on Guidestar shortly, and in any case these materials are available directly from the Foundation. Because the steady revenue stream is so important to our long term sustainability I’ll give an overview here.

History

In 2003 the Mozilla Foundation was established. The Mozilla Foundation is a non-profit organization organized to provide a home for the Mozilla community and stewardship for the assets of the project. The Mozilla Foundation started with around 10 employees. This was just barely enough people to make the Foundation functional and support the community. Still, supporting 10 people is a noticeable financial commitment; doing so consumed most of the funds the Foundation had available to it. (For those interested in historical detail, we had one person for QA, one person responsible for all of our tools and infrastructure, one person for each of the Firefox and Thunderbird front ends, 2 people for all of the rendering, layout and internals, etc, one person responsible for our “build and release” function, one architect, one engineering manager, one person responsible for business development, and me). The employees were stretched extremely thin, struggling to keep up with the opportunities available to the project.

In 2004 we released the Mozilla Firefox web browser. It was the right product at the right time — an elegant product filling a huge need in the market. Millions upon millions of people began using Firefox. As a result we were able to generate revenue by making it easy for people to find and use Internet search services. We began adding employees. We also began expanding our infrastructure — bandwidth for downloads, modernizing the inventory of equipment used to build the software and provide services to developers, update the public-facing websites, etc.

In 2005 Firefox became a product with millions of users, a growing significance in the Internet industry and a significant revenue stream. The revenue is from the easy “search” capabilities built into Firefox and the related revenue relationships with the search providers. We found that our users like the easy, customizable search capabilities, and the revenue could provide financial stability without the need for ongoing fund raising requests to our users or community.

In August of 2005 the Mozilla Foundation established the Mozilla Corporation as a wholly owned subsidiary to guide the development of Mozilla products, including Firefox. Revenue generated by Firefox becomes an asset of the Mozilla Corporation, which is in turn completely owned by the Mozilla Foundation. The assets of the Mozilla Foundation are dedicated to the public benefit. Revenue generated from Firefox is reinvested in the Mozilla project to improve operational capabilities and to provide long-term stability.

The number of people using Firefox increased steadily through 2005 and 2006. The resulting revenue stream from our search partners allowed us to continue to expand. We did so in both engineering for product development, and in the services we offer our userbase. We hired more people. For example, we started to build a professional IT team to handle increased load. We expanded our infrastructure still more to handle the millions of people who came to get and use Firefox. The improved infrastructure was demonstrated during the Firefox 1.5 release in November when our bandwidth requirements went way up and our service levels remained high. We hired more QA folks to both test and work with the community. We hired more engineers. We launched the Mozilla Developer Center, the first time we’ve had an on-going, successful documentation program.

Our revenue stream remains steady. We’re hiring a great set of people, with small teams where before we had a single person. We have a Firefox front-end team. We now have a build team instead of a single person. We have an Information Technology team. We have a set of people thinking about features and user experience. We have a platform team. We have people to respond when reporters call. We have a team of people maintaining our websites and webservices. We’ve been able to return to having a small set of people thinking first and foremost about community development. We’re still stretched very thin and still looking for great people.

Our infrastructure continues to be modernized. We’re upgrading the development infrastructure, in particular the “build” machines and infrastructure, which is a far larger job than it sounds. We’re upgrading the website infrastructure to support easier and more complete localization. Firefox 2 shipped simultaneously in 37 languages. That’s a massive and very rare achievement; I’m not sure who else does this.

2005 Financial Information

In 2005 the Mozilla Foundation and Mozilla Corporation combined had revenue from all sources of $52.9M. $29.8M of this was associated with the Foundation (both before and after the creation of the Corporation). The bulk of this revenue was related to our search engine relationships, with the remainder coming from a combination of contributions, sales from the Mozilla store, interest income, and other sources. These figures compare with 2003 and 2004 revenues of $2.4M and $5.8M respectively, and reflect the tremendous growth in the popularity of Firefox after its launch in November 2004.

The combined expenses of the Mozilla Foundation and Corporation were approximately $8.2M in 2005, of which approximately $3M was associated with the Foundation. By far the biggest portion of these expenses went to support the large and growing group of people dedicated to creating and promoting Firefox, Thunderbird, and other Mozilla open source products and technologies. The rate of expenses increased over the year as new employees came on board. The unspent revenue provides a reserve fund that allows the Mozilla Foundation flexibility and long term stability.

Strengthening the Mission

Our financial stability has enabled us to attract and retain world-class talent, people who have willingly turned their backs on the world of startups and stock options in order to work toward our goal of promoting choice and innovation on the Internet for the benefit of all. It enables us to support massive communities of people who contribute their efforts to making the Internet experience better. It allows us to cultivate competitive, viable community innovation.

The results are significant.

Our userbase is growing and happy. The Mozilla name represents quality and integrity to ever increasing millions of people. The extended community — volunteers, students, employees, developers, evangelists, extension developers, testers, documentation writers — is vibrant and effective. Internet life is a far better experience for millions upon millions of people that it was before Firefox and than it would be without the Mozilla project.

The Mozilla community — buttressed by the financial sustainability of the Mozilla Foundation — represents a powerful force for improving Internet life.

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