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Mozilla And Yahoo Sue Each Other Over Search Engine Deal

08 December 2017

That relationship ended early when Mozilla released the much-improved Firefox Quantum browser last month, with Google as the default search provider. Mozilla has now claimed breach of contract and filed its own cross-complaint.

In response to the lawsuit by Oath, Mozilla stated: "We recently exercised our contractual right to terminate our agreement with Yahoo based on a number of factors including doing what'd best for our brand, our effort to provide quality web search, and the broader content experience for our users".

Of course, Oath - which owns Yahoo and Verizon - isn't happy with this arrangement.

In its cross-complaint [PDF], Mozilla said it is seeking payments owed to it from the 2014 agreement. Attorneys representing Mozilla also did not respond to inquiries.

In yesterday's counter-complaint, Mozilla explains that it took another long look at the deal post-Verizon acquisition and was no longer in love with its choice of Yahoo as the default engine.

Also of interest is a section explaining that when Mozilla went to market for a search partner in 2014, it considered Yahoo! a very risky proposition and sought special protections in its contract. Web browsers, where most Internet users start their online visits, are a lucrative source of search traffic against which companies like Yahoo and Google sell ads.

By the middle of past year, only 23% of Firefox users kept Yahoo as the default search engine, Mozilla alleged. Mozilla was given a contractual right to terminate the agreement, if Yahoo was found unacceptable for some reason. But at the same time, what has to be considered is that while Mozilla's Firefox has a market share of 13 per cent, at the same time, Google's Chrome has a market share of close to 60 per cent. "Mozilla's revenue from Yahoo never met expectations", Mozilla wrote. It was a good move for the search provider - at least, it was until Verizon came along. Verizon executives even encouraged Mozilla to find other search providers, Mozilla said in court documents. The dispute in court will likely boil down to a factual determination of whether Mozilla's concerns were legitimate and supported by evidence.

"Mozilla brings this action.so that Mozilla will have access to the money needed to continue to develop and market the new major upgrade version of the Mozilla Firefox browser, and to fund the work that Mozilla is undertaking during this critical period of policy development to keep the Internet a global public resource, open and accessible to all", it said. Half way through this, Mozilla terminated the deal and resorted to using Google as the default search provider for Firefox. Venture Beat reports that Yahoo saw its search volume grow to a five-year high shortly after signing the deal.

Mayer's tenure at Yahoo was marred by a series of questionable management decisions that included spending $3 billion on acquisitions and famously paying ad man Henrique de Castro $109 million for 15 months of work.

Yahoo said in its lawsuit that it "has suffered and will continue to suffer competitive injury to its business and reputation, among other harm, and Mozilla's material breaches and bad-faith conduct are a substantial factor in causing such harm".

Mozilla And Yahoo Sue Each Other Over Search Engine Deal