Developers
August 26, 2020

Mozilla Layoffs: What They Mean and What Developers Can Learn

Mozilla’s recent layoffs should be a warning to all developers working to monetize their products.

Mozilla recently announced layoffs of some 250 people or roughly one-quarter of the company’s workforce. Unfortunately, these layoffs come on the heels of a previous round of layoffs that claimed another 70 jobs.

Aside from the questions about Firefox’s future, there are a number of lessons to be learned from Mozilla’s current situation.

Mozilla’s Announcements

On August 11, 2020, Mozilla CEO Mitchell Baker made the following announcement:

”Today we announced a significant restructuring of Mozilla Corporation. This will strengthen our ability to build and invest in products and services that will give people alternatives to conventional Big Tech. Sadly, the changes also include a significant reduction in our workforce by approximately 250 people. These are individuals of exceptional professional and personal caliber who have made outstanding contributions to who we are today. To each of them, I extend my heartfelt thanks and deepest regrets that we have come to this point. This is a humbling recognition of the realities we face, and what is needed to overcome them.”

On January 15, 2020, Baker made a similar announcement, albeit about 70 employees rather than 250.

”Creating the new products we need to change the future requires us to do things differently, including allocating resources for this purpose. We’re making a significant investment to fund innovation. In order to do that responsibly, we’ve also had to make some difficult choices which led to the elimination of roles at Mozilla which we announced internally today.”

The Implications of Mozilla’s Announcement

Almost immediately following the August announcement, the internet went into overdrive trying to find out what the implications were. The initial news was not encouraging.

* Firefox devtools

* Firefox incident/threat management team (?!)

* Servo

* MDN

* WebXR/Firefox Reality

* DevRel/Community (???)

I guess they're giving up?

— Kat Marchán (@zkat) August 12, 2020

In addition to the internal development teams, Mozilla’s announcement also impacted the Rust programming language, which Mozilla sponsors. In a blog post addressing the announcement, the Rust Core Team acknowledged the layoffs did impact a number of programmers working on the project.

At the same time, however, the Core Team made a point of highlighting the project’s resilience, and that many of the programmers working on it were not paid by Mozilla to do so. Instead, this was a project they were working on in their spare time, something that shouldn’t change.

What’s more, the Core Team and Mozilla are working to create a Rust foundation, which will help further the language’s development.

”Building on that work, the Rust Core Team and Mozilla are happy to announce plans to create a Rust foundation. The Rust Core Team's goal is to have the first iteration of the foundation up and running by the end of the year.”

What Went Wrong?

For many individuals, beyond the initial implications, there were questions about what went wrong. What led to Mozilla being in this position?

Further adding to the confusion is the fact that within hours of announcing the layoffs, Mozilla announced a new deal with Google to keep it as the default search engine. The deal was reported to be worth $400 to $450 million per year for the next three years.

Despite Mozilla originally framing it as the result of the impact COVID-19 had on the company’s business, and its attempts to roll out other business elements, ZDNet’s Catalin Cimpanu says the layoffs were part of a restructuring plan:

“However, several sources have confirmed that the organization is financially sound, and the layoffs were part of a restructuring of its core business, with Mozilla moving away from its current role of internet standards steward and experimental approach to its product catalog to more commercially viable offerings that generate revenues on their own.”

Why does an organization that is bringing in $400 to $450 million per year need to layoff a quarter of its employees, especially ones in such important areas?

According to Ted Mielczarek, a 12-year Mozilla veteran, some of it came down to complacency.

”I'm convinced that the biggest problem Mozilla had was that the business model we stumbled into (ad revenue sharing from search providers) gave us a firehose of money that was mostly disconnected from our execution no matter how you measure things.”

—Ted Mielczarek (@TedMielczarek) August 12, 2020

As a result of this scenario, Mozilla has spent the last several years going from one project to another in the hopes of creating a revenue stream outside of its ongoing deals with Google. The list includes the acquisition of Pocket, Firefox OS development and more. Most recently, the organization has been developing and releasing Mozilla VPN.

Unfortunately, the influx of cash not tied to the organization’s execution created a business model that, as Mielczarek points out, led Mozilla to where it is today.

What Developers Can Learn

There are a number of lessons developers can learn from Mozilla’s situation.

First and foremost, it’s important for developers to have a clear plan to monetize their products or services. In the case of Mozilla, its primary product is one that is traditionally given away for free. As a result, it had to look to other means of funding development, including the ongoing search deals with Google. While those deals provided “a firehose of money,” because the money wasn’t directly tied to the organization’s execution, it helped create a situation where there was a lack of direction about where to go next.

As a result, the company spent time and money trying to build products and services that had little to nothing to do with its core business. In essence, Mozilla seems to have forgotten what draws people to it—its web browser.

TechRepublic’s Jack Wallen makes the case that integrating enterprise-grade features with Firefox would result in a product that businesses would gladly pay for, while the core browser remained free to consumers.

”Something like Nextcloud. That would certainly be a kick in the pants to Google if Mozilla were to purchase or even just make a deal with Nextcloud and then integrate the web browser into that cloud platform such that the two worked as one. Imagine the Nextcloud desktop client enmeshed with the Firefox browser. I could see companies paying for that.”

The same is true of developers in general. Rather than spending resources on Hail Mary projects far removed from their core products, most developers do better building on what made them successful in the first place.

Similarly, it’s important for developers to not put all of their eggs in one basket—especially when that basket is a competitor’s. When Firefox was the dominant browser, it made perfect sense for Google to spend big money to make sure it was the default search engine. With Firefox’s market share at a mere 4.26%, however, it’s likely only a matter of time before Google no longer sees the benefit of paying nine figures a year to be the default search engine on what is increasingly a niche product. The warning to developers is clear: Don’t rely on a competitor as a primary source of income.

What the Future Holds

What the future holds is anyone’s guess at this point. Hopefully, Mozilla’s claims they are financially sound are true. Hopefully, Mozilla is able to purchase or develop a product that integrates with Firefox, making it indispensable to its target audience, rather than wasting resources on projects that don’t pan out. And hopefully, Mozilla is able to diversify its revenue stream, rather than being reliant on its primary competitor.

Whatever happens with Mozilla, however, its example should serve as a warning to developers large and small about the need to have clear direction and a solid plan to monetize their products.

TagsMozillaLayoffsDevelopers
Matt Milano
Technical Writer
Matt is a tech journalist and writer with a background in web and software development.

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DevelopersAugust 26, 2020
Mozilla Layoffs: What They Mean and What Developers Can Learn
Mozilla’s recent layoffs should be a warning to all developers working to monetize their products.

Mozilla recently announced layoffs of some 250 people or roughly one-quarter of the company’s workforce. Unfortunately, these layoffs come on the heels of a previous round of layoffs that claimed another 70 jobs.

Aside from the questions about Firefox’s future, there are a number of lessons to be learned from Mozilla’s current situation.

Mozilla’s Announcements

On August 11, 2020, Mozilla CEO Mitchell Baker made the following announcement:

”Today we announced a significant restructuring of Mozilla Corporation. This will strengthen our ability to build and invest in products and services that will give people alternatives to conventional Big Tech. Sadly, the changes also include a significant reduction in our workforce by approximately 250 people. These are individuals of exceptional professional and personal caliber who have made outstanding contributions to who we are today. To each of them, I extend my heartfelt thanks and deepest regrets that we have come to this point. This is a humbling recognition of the realities we face, and what is needed to overcome them.”

On January 15, 2020, Baker made a similar announcement, albeit about 70 employees rather than 250.

”Creating the new products we need to change the future requires us to do things differently, including allocating resources for this purpose. We’re making a significant investment to fund innovation. In order to do that responsibly, we’ve also had to make some difficult choices which led to the elimination of roles at Mozilla which we announced internally today.”

The Implications of Mozilla’s Announcement

Almost immediately following the August announcement, the internet went into overdrive trying to find out what the implications were. The initial news was not encouraging.

* Firefox devtools

* Firefox incident/threat management team (?!)

* Servo

* MDN

* WebXR/Firefox Reality

* DevRel/Community (???)

I guess they're giving up?

— Kat Marchán (@zkat) August 12, 2020

In addition to the internal development teams, Mozilla’s announcement also impacted the Rust programming language, which Mozilla sponsors. In a blog post addressing the announcement, the Rust Core Team acknowledged the layoffs did impact a number of programmers working on the project.

At the same time, however, the Core Team made a point of highlighting the project’s resilience, and that many of the programmers working on it were not paid by Mozilla to do so. Instead, this was a project they were working on in their spare time, something that shouldn’t change.

What’s more, the Core Team and Mozilla are working to create a Rust foundation, which will help further the language’s development.

”Building on that work, the Rust Core Team and Mozilla are happy to announce plans to create a Rust foundation. The Rust Core Team's goal is to have the first iteration of the foundation up and running by the end of the year.”

What Went Wrong?

For many individuals, beyond the initial implications, there were questions about what went wrong. What led to Mozilla being in this position?

Further adding to the confusion is the fact that within hours of announcing the layoffs, Mozilla announced a new deal with Google to keep it as the default search engine. The deal was reported to be worth $400 to $450 million per year for the next three years.

Despite Mozilla originally framing it as the result of the impact COVID-19 had on the company’s business, and its attempts to roll out other business elements, ZDNet’s Catalin Cimpanu says the layoffs were part of a restructuring plan:

“However, several sources have confirmed that the organization is financially sound, and the layoffs were part of a restructuring of its core business, with Mozilla moving away from its current role of internet standards steward and experimental approach to its product catalog to more commercially viable offerings that generate revenues on their own.”

Why does an organization that is bringing in $400 to $450 million per year need to layoff a quarter of its employees, especially ones in such important areas?

According to Ted Mielczarek, a 12-year Mozilla veteran, some of it came down to complacency.

”I'm convinced that the biggest problem Mozilla had was that the business model we stumbled into (ad revenue sharing from search providers) gave us a firehose of money that was mostly disconnected from our execution no matter how you measure things.”

—Ted Mielczarek (@TedMielczarek) August 12, 2020

As a result of this scenario, Mozilla has spent the last several years going from one project to another in the hopes of creating a revenue stream outside of its ongoing deals with Google. The list includes the acquisition of Pocket, Firefox OS development and more. Most recently, the organization has been developing and releasing Mozilla VPN.

Unfortunately, the influx of cash not tied to the organization’s execution created a business model that, as Mielczarek points out, led Mozilla to where it is today.

What Developers Can Learn

There are a number of lessons developers can learn from Mozilla’s situation.

First and foremost, it’s important for developers to have a clear plan to monetize their products or services. In the case of Mozilla, its primary product is one that is traditionally given away for free. As a result, it had to look to other means of funding development, including the ongoing search deals with Google. While those deals provided “a firehose of money,” because the money wasn’t directly tied to the organization’s execution, it helped create a situation where there was a lack of direction about where to go next.

As a result, the company spent time and money trying to build products and services that had little to nothing to do with its core business. In essence, Mozilla seems to have forgotten what draws people to it—its web browser.

TechRepublic’s Jack Wallen makes the case that integrating enterprise-grade features with Firefox would result in a product that businesses would gladly pay for, while the core browser remained free to consumers.

”Something like Nextcloud. That would certainly be a kick in the pants to Google if Mozilla were to purchase or even just make a deal with Nextcloud and then integrate the web browser into that cloud platform such that the two worked as one. Imagine the Nextcloud desktop client enmeshed with the Firefox browser. I could see companies paying for that.”

The same is true of developers in general. Rather than spending resources on Hail Mary projects far removed from their core products, most developers do better building on what made them successful in the first place.

Similarly, it’s important for developers to not put all of their eggs in one basket—especially when that basket is a competitor’s. When Firefox was the dominant browser, it made perfect sense for Google to spend big money to make sure it was the default search engine. With Firefox’s market share at a mere 4.26%, however, it’s likely only a matter of time before Google no longer sees the benefit of paying nine figures a year to be the default search engine on what is increasingly a niche product. The warning to developers is clear: Don’t rely on a competitor as a primary source of income.

What the Future Holds

What the future holds is anyone’s guess at this point. Hopefully, Mozilla’s claims they are financially sound are true. Hopefully, Mozilla is able to purchase or develop a product that integrates with Firefox, making it indispensable to its target audience, rather than wasting resources on projects that don’t pan out. And hopefully, Mozilla is able to diversify its revenue stream, rather than being reliant on its primary competitor.

Whatever happens with Mozilla, however, its example should serve as a warning to developers large and small about the need to have clear direction and a solid plan to monetize their products.

Mozilla
Layoffs
Developers
About the author
Matt Milano -Technical Writer
Matt is a tech journalist and writer with a background in web and software development.

Related Articles