Will IE Be Able to Displace Firefox? (GOOG, MSFT, YHOO)

Includes: GOOG, MSFT, YHOO
by: David Jackson

Browser market share is a critical issue for search players Google (GOOG), Yahoo (YHOO) and Microsoft (MSFT). As search becomes embedded in the browser, the company chosen as the default search engine wins, because typing a search term into a browser window is more convenient than going to a web page and typing a search term into a box. It's as simple as that.

Firefox has generated over $70 million of revenue to date from a deal to use Google as its default search engine. Apple uses Google as the default search engine in Safari. Who knows what deal Apple cut with Google and how much it makes from that arrangement?

Which leads to a crucial issue for investors in Google and Yahoo: When will Microsoft release a version of Internet Explorer (IE) with search conveniently embedded in the browser (as opposed to a side bar or tool bar)? Because when it does, Microsoft will certainly use MSN as the default search for IE, and Google will haemorrhage search market share.

This is why Google is so interested in promoting adoption of Firefox and other desktop-based search clients. Whatever people use to access the Internet will influence the search service they use. Google investors haven't registered this; but Google itself views Mozilla (developer of Firefox) as a key partner.

But Firefox has a growing advantage over the as-yet-unreleased upgrade to IE. It has a growing array of plug-ins provided by a community of third party developers. That ecosystem aligns the interests of third parties with Firefox, making it harder to displace when IE rolls out.

I'm writing this now because we've just released a Stock Search plug-in for Firefox. With one click, you can add Stock Search to your browser, allowing you to search by stock ticker and see what our community of money managers and other authors are saying on a stock before you buy or sell. (To load the plug-in, click the words "Seeking Alpha" on the Seeking Alpha Firefox plug-in page. To search a stock directly from Firefox, click on the logo on the left of the search box to get the drop-down menu of search options, select SA, and type in a stock ticker and press "return". You'll get all the content on that stock from Seeking Alpha.)

Because of our Stock Search plug-in, we're now incentivised to promote Firefox over IE. As are about 2000 other companies.

Will that be enough to stop Microsoft dislodging Google with its next release of IE? I'm not sure. But it certainly helps.

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