Google's Holiday Gift to Mozilla: A Search Deal Worth Nearly One BILLION Dollars

Paul Lilly

Mozilla on Tuesday announced it had inked a new search agreement with Google (we covered the story here ) that would extend the mutually beneficial partnership for at least three years, but what we didn't know is how much the deal was worth. Now we do. The sultan of search will pay Mozilla just shy of $300 million a year for the right to to have Google featured as the default search engine in Firefox, making the total deal worth around $900 million, or more than a billion dollars if it goes beyond three years.

These figures come from AllThingsD , whose sources said $1 billion was the minimum revenue guarantee Mozilla was seeking in a search deal. Microsoft was also in the running, and apparently was pretty aggressive in its attempts to supplant in its attempts to slide into Google's parking space.

Yahoo was also engaged in talks with Mozilla, but ultimately the asking price was too high, especially if a bidding war were to break out with Microsoft and Google.

The new deal represents a huge lucrative upgrade for Mozilla. According to the most recent financial records, Mozilla's search deal with Google was responsible for 84 percent of the browser maker's $123 million in revenue in 2010. That works out to about $103 million a year, or a third of what Mozilla will now collect from Google on an annual basis.

And this, folks, is part of the reason why the almighty browser wars are so important. Browsers are free to download, but when you command even just a quarter of the market (NetMarketShare reports Firefox's share of the browser market at 22 percent; StatCounter puts it at 25.23 percent), you can come within striking distance of a billion dollar search deal like Mozilla just did.

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