Comment by ThePhysicist

They might face regulation e.g. in the EU (but also the US) based on antitrust or competition laws, as they would effectively be dominating the browser market. That would limit their freedom to operate, so I can believe that it's in their best interest to "allow" competitors like Firefox to capture a small market share. Effectively they could kill them easily as a large percentage of Mozilla's revenue (I think more than 50 %) comes from the Google search deal, and I don't think that deal is really vital to Google. Source: https://en.wikipedia.org/wiki/Mozilla_Corporation