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Ramona
Joined: 19 Jun 2002
Posts: 2370
Location: Midwest USA
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 03 Aug, 2005 3:01 pm Mozilla Foundation Announces Creation of Mozilla Corporation |
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Mozilla Foundation Announces Creation of Mozilla Corporation
Wednesday August 3rd, 2005
The Mozilla Foundation has announced the creation of the Mozilla Corporation, a wholly-owned subsidiary that will continue the development, distribution and marketing of Mozilla Firefox and Mozilla Thunderbird. Unlike the non-profit Mozilla Foundation, the Mozilla Corporation will be a taxable entity (that is, a for-profit rather than a non-profit) but the Foundation is eager to emphasise that it will pursue the same public benefit goals as the Foundation itself and will not be driven purely by revenue goals.
The change will not affect the day-to-day development of Mozilla, with the current system of module owners, drivers, reviewers and super-reviewers staying in place. End-users are unlikely to notice any difference either, though the Mozilla Foundation and the Mozilla Corporation will eventually have separate websites. At the moment, only Firefox and Thunderbird will be developed under the auspices of the Mozilla Corporation; other projects, such as Camino and SeaMonkey, will continue to be overseen by the Mozilla Foundation.
Read more.....
.
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beanboy89
Joined: 16 May 2004
Posts: 1470
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| 03 Aug, 2005 3:17 pm |
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Thanks Ramona.
Some highlights from Mozilla Foundation Reorganization page:
| Mozilla Foundation wrote: |  What is the Mozilla Foundation announcing today?
The Mozilla Foundation is creating a new wholly owned taxable subsidiary, the Mozilla Corporation, to do product development and distribution for Firefox, Thunderbird, and related branded products based on the Mozilla open source code base.
What is the role of the Mozilla Corporation?
The Mozilla Corporation is responsible for productizing and distributing Firefox, Thunderbird, and related branded products built on the Mozilla open source code base. The Mozilla Corporation's mission, shared by that of the Mozilla Foundation, is to promote choice and innovation on the Internet.
Why has the Mozilla Foundation decided to make this change?
The Mozilla Corporation was established to support the Mozilla Foundation�s mission to ensure choice and innovation on the Internet by leveraging the economic value of Firefox which has resulted from its growing marketshare. By forming a commercial subsidiary, the revenue-generating activities of the new entity can provide funds to support development, testing, and productization of the various Mozilla open source technologies. This benefits both end-users of Firefox and Thunderbird, and developers and others who want to use the Mozilla open source code in various ways. Having the Mozilla Corporation handle revenue-generating activities associated with these products also allows the Mozilla Foundation to achieve its goals while still itself remaining a tax-exempt organization.
However, the Mozilla Corporation is not a typical commercial entity and will only pursue revenue-generating activities that are consistent with offering end-users with the best experience possible. |
Mozilla Corporation website
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J-M
Joined: 25 Jul 2004
Posts: 777
Location: Helsinki, Finland
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| 03 Aug, 2005 3:50 pm |
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Earlier www.mozilla.com had a redirect feature switched to www.mozilla.org main page. In fact, Google's cache has 'an original' page titled Mozilla - Home of the Firefox web browser and Thunderbird e-mail client from mozilla.com yet.
eWEEK has a new article New Mozilla Subsidiary to Cash in on Firefox Success about this news:
http://www.eweek.com/print_article2/0,1217,a=157263,00.asp
Hmmm, there is http://www.mozilla.net/ and http://www.mozilla.biz/ registered too, but not by Mozilla Foundation . 
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Antony
Joined: 18 Jun 2002
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Location: Sydney, Australia
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| 03 Aug, 2005 8:11 pm |
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| Mozilla Foundation wrote: | Why has the Mozilla Foundation decided to make this change?
The Mozilla Corporation was established to support the Mozilla Foundation�s mission to ensure choice and innovation on the Internet by leveraging the economic value of Firefox which has resulted from its growing marketshare. By forming a commercial subsidiary, the revenue-generating activities of the new entity can provide funds to support development, testing, and productization of the various Mozilla open source technologies. This benefits both end-users of Firefox and Thunderbird, and developers and others who want to use the Mozilla open source code in various ways. Having the Mozilla Corporation handle revenue-generating activities associated with these products also allows the Mozilla Foundation to achieve its goals while still itself remaining a tax-exempt organization.
However, the Mozilla Corporation is not a typical commercial entity and will only pursue revenue-generating activities that are consistent with offering end-users with the best experience possible. |
So a non-profit organisation can have a commercial subsidiary to generate revenue?
Is that allowed?
Also, what is Mozilla Corporation's activities? What products or services is Mozilla Corporation selling? In other words, exactly what sort of business is Mozilla Corporation is doing in order to generate revenue? I can't find it anywhere in the website.
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TK19
Joined: 04 May 2005
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Location: New York
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| 03 Aug, 2005 8:12 pm |
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I'm not sure about any of this but does this effect downloadind Mozilla products?
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I have no signature. |
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Alice
Alice Wyman
Joined: 21 Jul 2002
Posts: 1787
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| 04 Aug, 2005 10:17 am |
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TK19.
End-users shouldn' t notice any changes at all, from all I've read.
| Antony wrote: | So a non-profit organisation can have a commercial subsidiary to generate revenue?
Is that allowed? |
Yes
| Antony wrote: | | Also, what is Mozilla Corporation's activities? What products or services is Mozilla Corporation selling? In other words, exactly what sort of business is Mozilla Corporation is doing in order to generate revenue? |
From what I've gathered, Mozilla generates income through business relationships such as with Google, for featuring it's search engine.... Mozilla gets paid for that, it's not done for free  ..... More in the talkback article.... the "Read More" link provided by Ramona:
http://www.mozillazine.org/talkback.html?article=7085
(look at the replies by mlefevre and AlexBishop)
More on the Mozilla reorganization, from http://glazman.org/weblog/dotclear/index.php?2005/08/03/1145-mozco
Mozilla Corp. in 12 simple items
| Quote: |
Why?
1. because MozFo probably makes too much revenue for a non-profit organization, and that may become a serious legal problem
2. because corporations (partners, embeddors, ...) and potential hires prefer dealing with a corporation rather than with a non-profit, they just don't understand/trust non-profit; that's why "Mozilla Corporation" name is perfectly adequate.
3. because it can trigger new revenue streams
Cons:
1. taxes, so less revenue immediately for the foundation, but that was not an option, see Why-1 above
2. potential negative feedback from some fanatics in the community
3. stricter division of workforce between "mozilla products" that generate revenue, and "mozilla projects" that don't generate revenue, potentially disadvantaging the latter
Protections:
1. 100% owned by MozFo
2. no stocks, no shares, no IPO, products remain free, income is 100% shared, boards to control everything
3. same people, same spirit, same <>goals
Open questions AFAIC:
1. it's not clear at all who's responsible for evangelism. Or even marketing. MozFo or MozCo? MozFo is responsible for promoting blahblah but MozCo has to productize branded tools based on Mozilla
<snip> |
| Frank Hecker (director of policy for the Mozilla Foundation) wrote: | Why 1: I am not a tax lawyer (insert standard disclaimer), but my personal understanding is that the issue with revenue is not the amount of revenue, but rather the type of revenue. If an organization raises money in ways similar to those that might be used by a traditional for-profit corporation, and performs similar functions to what a traditional for-profit might do, then it makes sense to use an organizational framework more like a traditional corporation than a tax-exempt nonprofit organization.
However to my knowledge nothing prevents the Mozilla Foundation from raising as much revenue as it can through donations and related means associated with tax-exempt nonprofit organizations. The Mozilla Foundation will still accept donations, and I encourage people to make donations; one of the topics I'm interested in is how to use such donations to best effect.
Open questions 1. Who does evangelism for what is indeed somewhat of an open question, one that we can and should discuss going forward. As an initial statement, clearly product marketing (in the traditional sense) for Firefox and Thunderbird should be coordinated by the Mozilla Corporation, and it might make sense to have initiatives like SpreadFirefox (i.e., that are tied directly to Firefox and/or Thunderbird) also be coordinated by the Mozilla Corporation. On the other hand, for products that are not directly handled by the Mozilla Corporation (for example, Camino, to pick one at random), it might make sense for the Mozilla Foundation to coordinate evangelism efforts, in cooperation with the international affiliates where appropriate.
In these latter cases I'd expect the actual evangelism itself to be done mainly by volunteers, with the Mozilla Foundation and/or its affiliates providing oversight, coordination, and support where it makes sense to do so. (This is one place where donations could likely be put to good use.) |
From http://www.hecker.org/mozilla/dot-reorg
The Mozilla Foundation reorganization
| Frank Hecker wrote: |
.....At the same time the success of Firefox and Thunderbird has created significant economic value, in particular around the tens of millions of Firefox users and the web traffic they generate. This economic value represents an opportunity for the Mozilla Foundation to generate revenue to support the achievement of its goals, and to do so in a manner compatible with its public purpose and its focus on providing a high-quality end user experience. In other words, Firefox and Thunderbird can continue to be what people want them to be and expect them to be: free as in speech and free as in beer, gratis products based on open source code developed in the context of a public community.
However doing this successfully requires rethinking the organizational structure of the Foundation. Establishing the Mozilla Corporation as a taxable subsidiary of the Mozilla Foundation (as opposed to just another tax-exempt organization) provides more leeway to establish business relationships in support of the project, while still keeping the Mozilla Foundation itself as a traditional tax-exempt organization. As a wholly owned subsidiary the Mozilla Corporation is firmly tied to the Foundation and its goals and purposes—there are no outside investors, no stock grants or stock options for employees or others, and no possibility of an IPO, acquisition, or other “liquidity event”. |
The MoFo Reorganization page, http://www.mozilla.org/reorganization also mentions, | Quote: | Questions
Have a question that's not covered in the FAQ? E-mail us and we'll be updating the FAQ throughout the day. Email reorganization@mozilla.org |
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Antony
Joined: 18 Jun 2002
Posts: 12754
Location: Sydney, Australia
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| 04 Aug, 2005 7:12 pm |
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Alice,
Thanks for pointing out related posts.
This sounds like a taxation reason to me.
So Mozilla (Foundations and Corporation) can sell products/services to other companies as Mozilla is a commercial entity, as well as receiving non-profit discounts from other companies (licenses and any other products/services). Isn't Mozilla (Foundations and Corporation) trying to teach us how to cheat the tax system and in the same time lowing down the cost?
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Alice
Alice Wyman
Joined: 21 Jul 2002
Posts: 1787
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| 04 Aug, 2005 7:53 pm |
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http://www.mozillazine.org/talkback.html?article=7085
| Quote: | Re: Re: Negative comments
by AlexBishop <alex@mozillazine.org>
Thursday August 4th, 2005 12:23 PM
"There is only one reason to form a corporation: To get greedy."
No, it's because non-profits (which don't pay tax) are very restricted in terms of the type of economic activity they can do. Corporations (which do pay tax) have less restrictions. It's not much more than a tax designation.
Read this post from Brendan Eich to Slashdot:
< http://slashdot.org/comments.pl?sid=157930&cid=13234323 >
Alex |
More at Slashdot:
http://slashdot.org/article.pl?sid=05/08/03/1256216&tid=154
From Mitchell Baker, President, Mozilla Corporation and Board Member, Mozilla Foundation
http://weblogs.mozillazine.org/mitchell/archives/2005/08/organizing_the_1.html
| Quote: | Mozilla Firefox is approaching 10% market share, with figures showing usage several times higher in selected groups and countries. We're reaching the point where Mozilla Firefox is becoming a significant element of the Internet experience and has growing influence within the Internet and software industries.
This presence brings a range of opportunities. Many of these opportunities involve working with other commercial entities. Some involve generating revenue. This is an exciting time, both because our products are so well received and because the opportunity for the Mozilla Foundation to become self-sustaining in terms of revenue makes the long term vitality of the project much greater.
<snip>
... The Mozilla Corporation is a taxable entity and so is legally permitted greater freedom of action that is the Mozilla Foundation. The Mozilla Foundation will use this ability to interact with commercial entities and to generate revenue only in those cases where doing so meets the goals of the parent. In other words, its goals and mission are the same of the Mozilla Foundation, only it has greater flexibility in how to meet them. If it makes sense to generate revenue (as we currently do through search relationships) the Mozilla Corporation will look at doing so.
The Mozilla Corporation is legally a taxable, or in general terms, a "for-profit" entity. However, it is not a typical commercial entity. Its purpose is not to generate a return on investment in the financial sense. It is not an investment vehicle or an IPO candidate. It is completely owned by the Mozilla Foundation to promote an open Internet, where consumers have choice and innovation thrives.
More information about the Mozilla Foundation and the Mozilla Corporation and the relationship between them can be found at: www.mozilla.com or www.mozilla.org/reorganization.
The health of the Mozilla project, its long-term sustainability, and its role in maintaining diversity to the web is critical for the web. |
As I see it, then, the goal of the reorganization and move to a corporate structure was to afford the Mozilla organization more flexibility. Revenue-generation in support of the Mozilla Foundation is a means to achiving it's goals, not an end in itself.
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Antony
Joined: 18 Jun 2002
Posts: 12754
Location: Sydney, Australia
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| 05 Aug, 2005 9:53 pm Re: Mozilla Foundation Announces Creation of Mozilla Corpora |
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Only Firefox and Thunderbird?
So they are not spending as much resources on Camino and other projects SeaMonkey?
Not fair.
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Mandrake
Joined: 13 Sep 2002
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| 05 Aug, 2005 9:59 pm |
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The vast majority of people use Firefox and Thunderbird, so it's only sensible to devote the most resources to these products.
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Andrew T.
Joined: 14 Mar 2003
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Location: Somewhere beyond the sea
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| 05 Aug, 2005 10:00 pm |
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It is obvious that more resources began to be devoted to Firefox and Thunderbird a long time ago.
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Antony
Joined: 18 Jun 2002
Posts: 12754
Location: Sydney, Australia
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| 05 Aug, 2005 10:26 pm |
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| Mandrake wrote: | | The vast majority of people use Firefox and Thunderbird, so it's only sensible to devote the most resources to these products. |
sensible?
Those activists (consisting a huge percentage of university/college students who believe everything must be free or open source) who are active in MozillaZine pushed Mozilla.org to dump Mozilla Suite for Firefox + Thunderbird?
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Mandrake
Joined: 13 Sep 2002
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| 05 Aug, 2005 11:04 pm |
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Dumping the suite is the best thing that the Mozilla Foundation did, Firefox and Thunderbird are *far* more popular than the old Mozilla Suite was.
I can say the same thing with Apple, should Apple devote more resources to maintaning Mac OS 9 or Mac OS X?
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Antony
Joined: 18 Jun 2002
Posts: 12754
Location: Sydney, Australia
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| 05 Aug, 2005 11:11 pm |
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| Mandrake wrote: | | Dumping the suite is the best thing that the Mozilla Foundation did, Firefox and Thunderbird are *far* more popular than the old Mozilla Suite was. |
Popular does not mean better.
| Mandrake wrote: | | I can say the same thing with Apple, should Apple devote more resources to maintaning Mac OS 9 or Mac OS X? |
Apple announced transition plan, and the transition from OS 9 to OS X has completed (as announced by Steve Jobs in WWDC 2005)
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Mandrake
Joined: 13 Sep 2002
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