Google's 10-year run as Firefox's default search engine in the US is
over. Yahoo wants more search traffic, and a deal with Mozilla will
bring it
In a major departure for both Mozilla and Yahoo, Firefox's default
search engine is switching from Google to Yahoo in the United States.
"I'm
thrilled to announce that we've entered into a five-year partnership
with Mozilla to make Yahoo the default search experience on Firefox
across mobile and desktop," Yahoo Chief Executive Marissa Mayer said in a
blog post Wednesday. "This is the most significant partnership for Yahoo in five years."
The
change will come to Firefox users in the US in December, and later
Yahoo will bring that new "clean, modern and immersive search
experience" to all Yahoo search users. In another part of the deal,
Yahoo will support the Do Not Track technology for Firefox users,
meaning that it will respect users' preferences not to be tracked for
advertising purposes.
With millions of users who perform about 100
billion searches a year, Firefox is a major source of the search
traffic that's Google's bread and butter. Some of those searches produce
search ads, and Mozilla has been funded primarily from a portion of
that revenue that Google shares. In 2012, the most recent year for which
figures are available, that search revenue brought in the lion's share
of Mozilla's $311 million in revenue.
Google
now has Chrome, though, and it doesn't have to share search-ad revenue
from that browser with anybody but itself. Yahoo, meanwhile, has
ambitions to reclaim its former prominence in Web search. Yahoo showed a preview of a revamped search interface that Firefox users in the US will start seeing in December."At
Yahoo, we believe deeply in search -- it's an area of investment and
opportunity for us. It's also a key growth area for us," Mayer said.
"This partnership helps to expand our reach in search and gives us an
opportunity to work even more closely with Mozilla to find ways to
innovate in search, communications and digital content."
More flexibility in Firefox innovation
Mozilla
wanted to move away from a global search contract to one that offered
more regional flexibility, but the Yahoo deal also was motivated by
Mozilla's desire to improve the search experience for Firefox users,
said Mozilla Chairwoman Mitchell Baker. "They're open to innovations,"
she said.
That includes work on how Firefox's "awesomebar" -- its
combined address and search box -- retrieves data both from people's own
content and from what's available online. "Search of external providers
and search of our own stuff is closely related," Baker said. "There are
lot of potential improvements there."
Negotiating with Yahoo was
simpler than with Google, Baker said. Google competes directly to try to
lure users to its own Chrome browser.
"When you have a
partnership that has competitive aspect to it, it does require a lot of
time and attention and focus," Baker said.
Mozilla was in a good bargaining position: search engines have been placing a higher value on its search traffic, Baker said.
"Both
arrangements we were looking at had very good economics," Baker said.
"We're utterly confident in our stability and viability going forward."
More search volume
Search
volume is important to search engines. The more that people search, the
more opportunities advertisers have to show ads, including ads
associated with search terms that might not otherwise be common enough.
Terms of the deal weren't announced. Firefox users will continue to be able to change their default search engine.
Still,
Jan Dawson, chief analyst at Jackdaw Research, thinks many Firefox
users will not bother to change the default settings. "Google should be
concerned," said Dawson. "This could mean a significant switch in market
share away from Google toward Yahoo."
Google didn't immediately respond to a request for comment.
Firefox
was an early leader in building a search box directly into the browser,
but after a decade sending traffic to Google, Mozilla concluded it was
time for a change.
"Google has been the Firefox global search
default since 2004. Our agreement came up for renewal this year, and we
took this as an opportunity to review our competitive strategy and
explore our options," the organization said.
Mozilla has toyed with search-engine changes before, for example with a dalliance with Yandex in Russia, by setting Baidu as the default search engine in China and by making Bing, from erstwhile rival Microsoft, another option.
Yandex back for search in Russia
The
new deal with Yahoo is only one change in which Mozilla will become
more locally flexible, the nonprofit organization said. Mozilla is
keeping Baidu in China and switching back to Yandex in Russia. Mozilla
isn't actively looking at other search changes right now, Baker said.
The
Yahoo-Mozilla deal is an alliance of underdogs. Mozilla's share of
browser usage has been slipping in recent months, and Yahoo is third
place with 10 percent of US searches in October,
according to ComScore. For Yahoo, that was still enough for quarterly
search revenue of $450 million, after payments to the affiliates that
helped drive some of that search traffic. That was a 6 percent
year-over-year increase, Yahoo said.
Yahoo sold off its search
business to Microsoft five years ago, and Microsoft powers Yahoo search
results. However, Yahoo keeps some of the revenue -- indeed, all of it
for mobile searches. Yahoo declined to comment on specific revenue share
terms of that deal.
"We are coming to the midpoint of the
10-year agreement" with Microsoft, Mayer said after reporting results
for Yahoo's fiscal third quarter of 2014. "We may want to contemplate
changes on both sides. So Microsoft has some rights at that point, so do
we. We're working through this with Microsoft."
Mozilla has been
working with Yahoo for months on the partnership, and relations with
Yahoo's new CEO have been good, Baker said.
"Marissa has a very
strong product focus, which is wonderful," Baker said. "Really having an
executive who understands the product experience, who's really engaged
in it, has been a real high point. We've been happy that Yahoo has
gotten done the things that said they would get done with us."
