In the hierarchy of hot new tech startups, there’s not much love for the lowly web browser.
A browser won’t get anyone rich overnight, like a hit mobile app can. Making money from one is all about scale, but any new effort has to reckon with giants. Google Chrome, Mozilla Firefox, Microsoft Internet Explorer, and Apple Safari have carved up all but a few percentage points of the market among themselves.
Yet last week, a new desktop web browser called Vivaldi entered the ring. Led by Jon von Tetzchner, who cofounded and served as CEO of browser pioneer Opera, Vivaldi wants to appeal to power users with features like improved tab management, a built-in notepad, and advanced keyboard shortcuts. The browser is far from complete, but you can download a tech preview to get a sense of where it’s going.
Can Vivaldi compete against such corporate colossi as Google and Microsoft? In 2015, it’s only possible by playing a different game.
Von Tetzchner seems to have a chip on his shoulder when he speaks of Opera, the company he cofounded 20 years ago and left in 2011. Opera has changed over the last few years, he said, abandoning its power users and following the competition on a path to simplicity. When Opera dumped its Presto engine for Google’s Chromium–an open-source version of Chrome–in 2013, and redesigned its interface to boot, von Tetzchner felt like there was nothing left of his life’s work.
“I had no plans to make a browser, and competing with 17 years of hard labor was not what I had in mind,” he says. “But when they decided to throw all that work away, I changed my mind.”
Ironically, the same Chromium code that Opera used to change direction has also allowed Vivaldi to quickly enter the market. Rather than creating a new engine from scratch, Vivaldi can simply build off Google’s rendering engine and basic features, adding its own embellishments. In the tech preview, you can even see some of Chrome’s bones poking through, including an identical right-click context menu.
Browser connoisseurs might scoff at the strategy. The list of Chromium-based browsers is long, and none of them have had much of an impact. But von Tetzchner thinks he sees an opening: Opera currently has about 50 million users, and he estimates that about 20 million have never upgraded from Opera 12, the last version to use the Presto engine and old interface. (Statistics from NetMarketShare show 0.44% of all desktop browser usage going to Opera 26, and 0.32% going to Opera 12.)
“People actually want those features that we used to have,” von Tetzchner says.
Vivaldi’s immediate goals are modest. If the browser can just get to a few million users, von Tetzchner says the revenue from search engine deals and affiliate links would be enough to break even on his investment. He acknowledges that Vivaldi won’t be for everyone, but believes Opera’s push toward simplicity gives him a healthy niche.
You might think that only the biggest, name-brand browsers can be successful, but there are examples to prove otherwise.
Just look at Maxthon, a 10-year-old browser that doesn’t even register in most market share reports. The company isn’t ashamed of its obscurity–an old pitch in my inbox introduces it as “the biggest browser you’ve never heard of”–yet Maxthon International vice president Karl Mattson says the company has been profitable since the beginning, with steadily rising revenues.
“Once you have your core browser, it’s a pretty high-margin business if you manage it correctly,” Mattson said.
Maxthon and Vivaldi have a lot in common. Maxthon was borne out of displeasure with the incumbent–which at the time was Internet Explorer–and was originally based on a modified version of IE’s code. Today, it packs lots of features that cater to power users, and its business model uses the same search revenue share and affiliate link strategy that Vivaldi wants to wield.
There is, however, one major difference: About five years ago, Maxthon realized that it couldn’t bet on the desktop alone. It built an Android version, and started trying to get on as many smartphones as possible, especially in emerging markets where there’s lots of opportunity to pre-load browsers on new handsets.
Going mobile was the right call. While Maxthon once enjoyed 100 million active users on the desktop, that number has dwindled to around 15 million. But mobile usage, especially on Android, has “skyrocketed,” Mattson said, making up the vast majority of Maxthon’s remaining 15 million to 20 million users.
Maxthon’s plan doesn’t just provide a stream of new users, it also opens up new business models. You’d rarely see things like casual games, e-commerce, and Yahoo-like landing pages built into browsers for mature markets, but they’re much more common elsewhere in the world.
Maxthon isn’t the only browser pursuing this strategy. Dolphin, for instance, has been a mobile-only browser since its first release five years ago, and has been installed roughly 150 million times to date, says Edith Yeung, a partner at 500 Startups and an adviser to Dolphin. The company is “almost profitable,” Yeung said, and is turning much of its focus to pre-loading in emerging markets like Russia, Turkey, and Saudi Arabia.
“I think Dolphin growth is pretty much going to follow where Android is going to be strong,” Yeung says. While Dolphin offers bookmark sync extensions for the major desktop browsers, it has no plans to release a full-blown desktop version.
Examples like Maxthon and Dolphin show that it’s possible to be successful with a small-scale browser today, but they also underscore Vivaldi’s unique challenges.
Vivaldi isn’t just going where the market is in hopes of gaining share by default. Instead, it’s putting all its faith in the quality of the product, hoping that’s enough to make people switch from the browser they’re used to. But historically, that only happens on a large scale when the nature of web browsing changes.
“You can build something for 100,000 users, or 250,000 users, but to build something that tens of millions of users will switch to, you need an underlying platform shift for that to happen,” says Eric Vishria, the former cofounder and CEO of Rockmelt.
Instead, the biggest industry shifts were happening on smartphones and tablets, with apps like Flipboard that remixed links from Facebook and Twitter in interesting ways. Vishria says Rockmelt might have been sustainable on its own–it had about 5 million downloads, and far fewer active users–but the startup wanted to go bigger. In 2013, Rockmelt discontinued its desktop browser, in favor of mobile apps for discovery of web-based content, and was acquired by Yahoo later that year.
Vishia, who is now a partner at venture capital firm Benchmark, notes that it’s hard to build up active users without distribution power–the kind that Google had through its existing search and email applications. “The distribution power required to get tens of millions of people to switch browsers is unbelievable,” he says.
I have a theory about how Vivaldi could thrive: What if Vivaldi’s platform shift is about turning the browser into the ultimate desktop productivity tool? Laptops and desktops aren’t going away anytime soon, and we already use them for so much, from email to communications to file management to document editing.
What we lack are the tools to tie them all together. Tab management is difficult when you have dozens open at a time, and extensions are a sloppy way of fixing the problem. Chrome doesn’t even try to integrate Gmail at the browser level, so you can’t click a mail link to jump into the web-based client. And the kind of inline notes that Vivaldi envisions doesn’t exist in any mainstream browser. A new generation of browser for serious work could be compelling for more than just a handful of users.
As for getting people to try it out, von Tetzchner is patient, despite funding the browser’s creation and its 25-person team himself. Asked how long he’d be willing to stick with it, von Tetzchner wouldn’t pen himself in with an answer.
“It takes the time it will take. I am a very long-term thinker in everything I do. I start in one corner, and I build, and I build, and I build,” he says. “That’s what I did with Opera.”