Yahoo parent sues Mozilla for replacing it with Google as Firefox default search

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Mozilla countersues and says that poor Yahoo search quality caused Firefox to lose market share.

Roughly three years ago, Yahoo and Mozilla announced that Yahoo would be the default search engine on Firefox in the US. That relationship ended early when Mozilla released the much-improved Firefox Quantum browser last month, with Google as the default search provider.

Now, Yahoo’s parent company, Oath (Verizon), is suing Mozilla for breach of contract. Oath says that Mozilla “terminated a long-term strategic agreement with Yahoo” on November 10. Yahoo adds that prior to filing suit, it “demanded that Mozilla take immediate steps to cure its breaches and rescind its termination notice.”

The lawsuit seeks unspecified money damages and interest from Mozilla. We haven’t seen the contract, but Mozilla’s rationale for termination is pretty clearly laid out in a cross-complaint against Yahoo/Oath, claiming that it had a right to terminate the relationship under the contract:

Yahoo Search consistently failed to retain users and search volume over time, reducing the potential revenue [for Mozilla] under the Strategic Agreement. Rather than focus on improving the quality of its search product, as Yahoo assured Mozilla it would prior to entering into the deal, Yahoo continually focused on short-term monetization and special events such as the Olympics and the election, at the expense of product quality . . .

These issues began early in the relationship. As early as January 2015, Mozilla began discussions with Yahoo on the shortcomings of the quality of the search product . . . Mozilla determined in January 2015 that the user experience Yahoo Search provided was sub-par [and] identified “five areas I’d like to push Yahoo! on of the next few weeks.” … In no particular order, these issues affecting search quality included the relevancy of advertisements served on users, aggressive autocorrect, sub-par relevancy results, the content of answers, and the basis for triggering particular content.

Mozilla continued these types of discussions with Yahoo in March 2015, reiterating that Mozilla “wants improvement for both parties to grow marketshare,” but the “current experience is causing users to move.”

Mozilla cites third-party data that asserts that during the term of the agreement, Firefox lost market share to Chrome. It attributes this (at least in part) to Yahoo search. Yahoo/Oath will likely argue that issues with the browser experience (e.g., speed and performance) were to blame instead. The truth probably lies somewhere in between.

Firefox’s market share is about 13 percent to Chrome’s nearly 59 percent. Yahoo search market share is roughly 12 percent to Google’s 63 percent.

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