AOL laid off 58 employees in its Netscape division and announced that it was spinning off the Mozilla Project. AOL also said it will donate US$2 million to the new Mozilla Foundation. With another donation for $300,000 from Lotus founder Mitch Kapor, the fledgling group stands ready to further promote the Mozilla browser.

Though Mozilla is a niche player, some observers see potential for market growth. In the browser market, "there's a war within a war," Yankee analyst Rob Lancaster told NewsFactor. The desktop browser war already has been won by IE, but there is related market struggle for the wireless and business-application space, he explained. While he declined to forecast Mozilla's level of acceptance in these markets, he noted that "there are more and more applications that are developed with Web interfaces."

Better Browser?

In the eyes of some industry observers, the Mozilla browser is technically superior to Internet Explorer. PC World magazine put the browser in its "Best of 2003" category, and eWeek raved that Mozilla 1.4 includes "remarkable improvements that enhance what was already the best browser option out there."

Aberdeen analyst Russ Craig, who himself uses Mozilla, told NewsFactor that "there are a fair number of people who prefer the browser to the continual security issues that come with IE."

Unlike IE, Mozilla supports junk-mail filtering, pop-up ad blocking and tabbed browsing. It was developed to support open standards across a wide variety of platforms, including Windows, Linux, Mac OS X, OS/2 and Solaris.

Sun and Red Hat

The Mozilla Foundation will receive ongoing support from Red Hat and Sun Microsystems.

By the end of July, Sun will ship Mozilla for the Solaris OS, and it will make Mozilla the standard browser for Mad Hatter, the company's Linux-based desktop software stack due later this year.

Mozilla is "very near and dear to our hearts," Red Hat spokesperson Leigh Day told NewsFactor. She noted that Red Hat includes the open-source browser in all of its products, and hence is dedicated to supporting its development.

Mozilla welcomes the support. "It has been a long-standing objective of the Mozilla team to create an independent organization so we can continue to lead and innovate," said Mitchell Baker, who will head the new foundation. "Going forward, we will continue to partner with developers and industry leaders to keep content on the Web open."

Tiny Share

Mozilla is decidedly an underdog in terms of market share. According to recent surveys, IE has a 95 percent market share, with Netscape holding approximately 3 percent, and Mozilla in the 1 to 2 percent range. Craig said he "expects Mozilla to continue its presence."

Mozilla's tiny market share is partly the result of the browser's geeky image. That is, the Mozilla group, themselves programmers, targeted the browser at the developer community. The new Mozilla organization pledges to work on wider distribution.

Apple recently chose the KDE code instead of the Mozilla platform as the basis of the Safari browser. Apple reportedly chose KDE over Mozilla because of the compact size of the code (less than 140,000 lines) and the ease of development within that code. Some observers saw this as a criticism of Mozilla.

Three months later, Mozilla started focusing its efforts on the Phoenix Project, a smaller, faster version of Mozilla developed with extensible user interface language (XUL). This renders the browser with cross-platform technologies rather than with platform-specific programming language.