Analysis – Mozilla achieved an important milestone in November, sailing past 20% market share over an entire month for the first time since its release in November 2004. While Safari and Chrome were able to take over share from Microsoft’s Internet Explorer as well, Mozilla’s Firefox leaped by almost a full percentage point over October, according to data provided by Net Applications. Microsoft will need a compelling new browser rather sooner than later to slow this trend. The company’s Internet Explorer lost 1.5 points over the previous month, bringing the market share loss in 2008 to more than 5.8 points.
Mozilla has been playing with the 20% market share milestone for some time now, beginning with a few days per month in July (following the release of Firefox 3), to a consistent two weeks in October. According to data published by Net Applications, November has been the first month in which the average Firefox market share has topped 20% over a period of an entire month.
November market share numbers: Firefox, Safari and Chrome up; IE and Opera down
Firefox was estimated at 20.78%, up from 19.97% in October. The Internet Explorer dropped in the same time frame from 71.27% to 69.77% - and below the 70% mark for the first time in more than a decade. Apple’s Safari climbed from 6.57% to 7.13%, while Google’s Chrome eclipsed Opera with 0.83% (up from 0.74%) versus 0.71% (down from 0.75%). All numbers are based on the average market share posted for each day during the month.
According to Net Applications, Chrome has hit a new record market share and if we believe the data published, then it is clear that Google’s rapid and automated update cycle for Chrome is a significant contributor to the browser’s market share. Chrome currently stands at version 0.4.154.25 and was most recently updated on Thursday of last week.
The extended Thanksgiving weekend contributed to Firefox’ market share gain, since Firefox is especially strong in the consumer market, while certain Internet Explorer versions, such as IE6 (which still has an average market share of more than 20%), have a strong corporate user base and cause IE’s market share to decline substantially on weekends and holidays. However, Firefox would have posted 20%+ market share even without the Thanksgiving weekend: The browser fell slightly below 20% on only seven days during the month, while posting shares of up to 22.7% on others, according to Net Applications.
The market research firm also found that Firefox share jumped in the November 4 time frame, surrounding election day.
Mozilla’s wild ride
Of course, the big news this month is Firefox’ strong gain and milestone achievement. And looking at the browser’s brief history, the gain is even more impressive. Originally launched in November 2004, web analysis firms such as OneStat.com and WebSideStory estimated that Firefox hit a 5%-7% market share within one month after launch and somewhere between 7% and 9% within nine months.
Version 1.5, released in November 2005, was generally believed to have lifted Firefox into the 10% neighborhood. More reports by these firms issued about one year later (November 2006) claimed that Firefox had cleared the 10% mark and was hovering around 11%-13%. While the exact numbers published differed in some cases quite a bit, the trend was clear. Firefox was focused at Microsoft’s Internet Explorer and Mozilla was very successful – possibly because Microsoft was not concerned about Firefox’ impact until early 2006.
By mid 2007, Firefox was estimated at more than 15% market share. With today’s news that Firefox is at almost 21%, it seems that Mozilla is gaining 10% market share about every two years. And at least at this time, there is no indication that this trend will change anytime soon. Firefox market share numbers are substantially higher in certain regions of the world: For example, the browser’s market share in Europe is estimated at about 40% and in the U.S. at about 30%. 57% of TG Daily readers use Firefox.
Read on the next page: Microsoft's Internet Explorer in a downward spiral, IE's problems, Conclusion
Internet Explorer caught in a downward spiral
The Internet Explorer story is quite different and does not really start with the Spyglass Mosaic-based IE1 that was released in August 1995, but with IE4, which had its debut in September 1997 and was Microsoft’s weapon to take over the market share lead from Netscape.
IE4 was launched when Microsoft held about 30%-35% of the market, but took the company all the way up to about 60%. IE5 followed in March 1999 and increased Microsoft’s browser market share to more than 70% by the beginning of 2000. At that time, Microsoft reportedly employed more than 1000 people in projects directly or indirectly related to IE. The annual development and marketing budget was about $100 million.
IE reached its market share high in the 2003 time frame with an estimated 95%, which was held mainly by IE6, released in August 2001. Netscape was pretty much gone and Microsoft decided to slow down its browser development following IE6’s release. For about five years, users were kept happy with patches and updates. With Firefox’ introduction in 2004, IE’s market share began its decline and has been in a downward spiral ever since. In late 2005, Microsoft started taking Firefox more seriously and began work on a new browser version – IE7, which was released in October 2006. At that time, IE’s share was already down to about 85%, according to OneStat.com.
Despite Microsoft’s initial lead in security features for its browser, IE7 was not able to change the overall trend and has been losing overall market share since its introduction.
The first beta of IE8 was released in March of this year, the second beta followed in August. While it was generally expected that IE8 would be launched by the end of this year, Microsoft recently said that the browser would slip into 2009 – possibly behind Mozilla’s highly anticipated Firefox update v3.1, which we expect at the end of January or at the beginning of February.
The current market share numbers of different IE versions may surprise some. IE7 is, not surprisingly, the most used version with an average market share of about 47.5% in November, according to Net Applications. The seven year-old IE6 follows with an average share of 21.2%, which can be explained through the extensive corporate use of this browser. IE5 has about 0.05% and IE4 about 0.01%. IE8 has shown an upward trend, especially since the release of the beta 2 version. Net Applications currently estimates the browser at about 0.84% (up from 0.59% in October), which is slightly above Google Chrome (0.83%) and clearly ahead of Opera (0.71%). But IE8’s gains are not enough to make up for the market share loss of IE7 and IE6.
Microsoft’s problem #1: IE6 and corporate users
If we believe the numbers published by Net Applications, then Microsoft will have to battle Mozilla and possibly Apple and Google in the not too distant future on two different fronts - consumer and corporate markets.
Microsoft still benefits from its success in the late 1990s and early 2000s. Back then, IE6 was the dominant web browser and Microsoft convinced corporations to adopt the software for their browser-based applications. In many business environments, IE6 is still the standard browser, while most consumers have made the transition to the more recent IE7 version. Net Applications estimates that IE6 has a during-the-week market share of about 23%-24% and a weekend share of about 16-17%. These numbers have been on a decline over the past few years: For example, IE6 had about 27-28% (during the week) and 21%-22% (weekends) share in June of this year,
We recently mentioned that IE6 “may pose the greatest threat to Microsoft’s browser market share dominance” as well as the greatest opportunity for other browser manufacturers to pick up market share. While IE6 corporate market share is unlikely to dramatically change overnight and many businesses may continue to rely on IE6, it is clear that they will upgrade at some point in time and provide market share that is secure for years to come.
Microsoft’s problem #2: A flawed consumer strategy
IE7 and IE8 are clearly consumer browsers: Both show slight upticks in market share on weekends and account for more than 48% of the entire browser market. (Mozilla, Apple, Google and Opera also see increased market shares on weekends and holidays.)
Judging by the numbers provided by Net Applications, IE6 is surrendering market share quickly – market share IE7 and IE8 cannot pick up. Of the 4-6 percentage points IE6 lost over the past five months, IE7 and IE8 gained only a combined 1-2 percentage points.
To increase its market share again, it is obvious that Microsoft will have to have an attractive consumer browser. The company’s strategy was to increase the compatibility with web standards, but strangely enough added two new proprietary features (web slices and activities). More speed was also a goal, but not the primary goal. The first beta of IE8 was, according to Microsoft, about twice as fast as IE7, but still behind Firefox 3 beta 5, the most current Firefox version when IE8 beta 1 was released. IE8 beta 2 was accelerated again, but is still substantially behind Firefox, Safari, Opera and especially Chrome.
Speed is the name of the game. Microsoft is dead last at the moment, which means that consumers who evaluate browsers from time to time may switch to a different product. Objectively, there are very few reasons to stay with IE7 or IE8 at this time.
Conclusion: Firefox will continue to tear into IE market share, but is vulnerable
There is no doubt that especially Mozilla has a really good handle on delivering what users are looking for in a browser. And as far as we can see, Firefox 3.1 will be a terrific browser and the best software of its kind when it will be released sometime in Q1 2009. Current beta versions (the first beta 2 release candidate build was released last week) run stable and provide a good idea how the update will look like.
In the current environment, Firefox may offer the best compromise of features among all browsers, while IE is the least attractive software of its kind. In our opinion, there is nothing in sight that could slow Firefox’ current pace. Safari, Opera and Chrome are interesting alternatives, with very specific strengths, but do not have the overall appeal of Firefox: Safari lacks security features, Chrome is a very rough beta version with many features still missing and while Opera is always touted as the possibly best browser, it does not have Firefox’ extension variety and seems to be destined to remain an exotic solution.
IE8 beta 2 is clearly not the browser users want and Microsoft needs. In fact, we believe that if not changed significantly, IE8 could cause Microsoft to lose its dominant role in the browser market. The paradigm in web browsing is shifting and Microsoft has not found an effective answer yet.
Mozilla is also vulnerable. Pretty much all of the organization’s income is generated by an agreement with Google. It does not take much to see that Mozilla will need other revenue sources down the road, if it needs to compete with a much more serious Microsoft and a Chrome browser that is likely to gain more traction in the future.