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November 16, 2012

Open Source Means Nine-Figure Revenues for Mozilla

By Steve Anderson, Contributing TMCnet Writer

"Open source" does not have to mean "unprofitable", as the 2011 numbers released yesterday by Mozilla (News - Alert) showed quite clearly. While one of its major releases, Mozilla Firefox, is absolutely free for users, there's still plenty of money in the operation, as seen by revenue growth that was not only huge on a percentage scale, but pretty impressive on an objective one too.

The reports made it perfectly clear: in 2011, Mozilla's total revenue was $163.5 million. This represented a healthy jump from 2010 revenue, which was still pretty solid at $123.2 million. Given that, in just 2007, Mozilla reported revenue of $75 million, that's a pretty big jump in a fairly short time. 

Image via Shutterstock

So what's driving so much revenue for a product anyone with an Internet connection and about five minutes or so can get for no cost? Royalties. Fully $161.9 million of the total $163.5--all but $1.6 million, in fact--came from royalties. The Mozilla financial report describes it this way: "Mozilla receives royalty income from contracts with various search engine and information providers. Revenue from these contracts is determined by the search and information providers based upon end user activity. In addition, Mozilla receives royalties from the sale of various products on its website."

So while royalties--and Google (News - Alert) for a large part--is the primary source of income for Mozilla, they don't seem to be hurting. Additionally, there are those that expect even better when FirefoxOS, a mobile operating system, finally makes its debut in 2013. Some, like Strategy Analytics, even go so far as to suggest that FirefoxOS will claim fully one percent of the entire global smartphone market in 2013. That's a lot of extra royalties for Firefox, and will likely help their revenue see further gain as both search and mobile providers kick in.

The numbers aren't half bad for a company that offers one of their major products at no charge, and hopefully, those results will carry on and Firefox users will continue to enjoy a no-cost browser that's easily a match for most of the others in the market.  

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Edited by Brooke Neuman
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