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Mozilla Foundation Launches Mozilla Corporation
An anonymous reader writes "MozillaZine is reporting that the Mozilla Foundation has created a commercial subsidiary to continue development of Mozilla Firefox and Mozilla Thunderbird. Don't let the word "commercial" scare you, the new Mozilla Corporation (as it has been dubbed) will be owned 100% by the Mozilla Foundation. The change is mostly a legal/tax thing to avoid the problems of pursuing revenue-generating avenues while remaining a non-profit. There will be no change to the development process and end-users won't notice much difference either. See also the Mozilla Foundation press release about the Mozilla Corporation and the Mozilla reorganization FAQ."
What a fool believes, he sees, no wise man has the power to reason away.
Going IPO means your shares are publicly traded, and you have a duty to your shareholders to make money. That can mean that you make decisions based on money rather than what is best for your product. In games, it usually means rushed releases and unfinished products. In software it can mean anything from a rushed release to signing a deal with Gator to include their software in your browser for extra money. That is obviously a worst case scenario.
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According to Mitchell Baker--MoFo's Chief Lizard Wrangler and the new MoCo's President--the Foundation already generates revenue through "search relationships". No prizes for guessing who she's talking about.
Why is anything anything?
Yipes.
An Initial Public Offering of stock (i.e., an "IPO") is done when there are venture capitalists or owners who want an exit strategy to realize their investment proceeds (i.e., "cash out"). These are traditionally only used by large companies, though, in the "tech boom", small companies were boosted with cash so that they could function like large companies through outside investment. IPOs are very expensive and time-consuming, so they are mostly only used for large businesses.
Another strategy that owners use to get out of the business is an Employee Stock Ownership Plan (ESOP). These can be used by large and/or small businesses. It's not as glamourous and it takes a while. There's no immediate "cash out".
Both an IPO and an ESOP are similar in that the owners are giving up some sort of control. With an ESOP, owners are giving up some control to employees. With an IPO, owners are giving up some control to the public.
99% of businesses are small businesses and thus do not have the interest nor funding nor capability to do an IPO.
Mozilla Corporation will likely be a small business run by a small group of people who are passionate about developing Mozilla to its fullest potential.
Twist of events: I imagine it is necessary for Mozilla to make a profit under the for-profit side to keep their nonprofit 501(c)(3) status. Sometimes organizations started for humanitarian purposes end up taking in too much cash (and, by that, I don't mean a lot..because the limits are low) and have to do this for tax reasons.
That's it.
I have asked Mozilla Foundation for a copy of their 2004 Form 990, which would reveal how much money they took in from Google. Rumor has it that it's tens of millions. I'm curious about whether they filed a 990-T to pay taxes on this unrelated business income. Mozilla is late with their 2004 filing, just as they were with their 2003 filing. It's clear that there is a massive jump in income from 2003, which was appropriate for a nonprofit, to 2004, which promises to be more interesting. There is no question in my mind that the 501(c)(3) tax-exempt public charity status is not the ideal vehicle for laundering Google's lucre. It raises too many eyebrows.
The sellout to Google is quite substantial. We all know about the prefetch for the Google search bar, and how you can disable this in about:config under network.prefetch-next if you don't like collecting cookies from places that you never visit.
What's not commonly known is that this configuration option does not affect the behavior of terms entered in the address bar. If Firefox cannot parse the URL, it will go to Google and pick up the number one site, and then take you there directly. It's like a built-in "I'm feeling lucky."
Convenient? Sure, assuming that a huge percentage of surfers haven't a clue about the difference between search terms entered in a search box, and a URL entered in an address bar. Studies show that this is indeed the case.
Explorer does something similar, in that a search term in the address bar will take you to a search preview, assuming that you don't have Active Scripting disabled. But arguably, this is more benevolent than what Firefox is doing with Google. The way that Firefox is doing it gives Google much more control over web traffic patterns. It makes it much more important to be number one on Google for your selected keywords than it is to be number one on MSN for the same keywords, if everything else is equal.
And it's not like Google's first result is always the best. Recent studies show wide disparity between various engines for the top results.
Moreover, all the several-year-old Google bombs still work. Except one, that is. I made a Google bomb for "out-of-touch executives" that led to Google's corporate executives page. It was doing great in all the engines for the first half of 2004, and even got mentioned in the New York Times in June, 2004. But then Google defused this particular bomb by doing a hand job on their algorithm in July, 2004. It disappeared in Google, and I took my links down. But it was a great bomb nonetheless, and is still doing fine in Yahoo and MSN.
So Google cannot even claim that their mathematical methods are untainted by self-interested sabotage in certain cases. That makes them evil. And with Firefox going along with their game plan, that moves Firefox one step closer to the dark side.