The Russian authorities tightened its grip on the web as a state-controlled firm with shut hyperlinks to president Vladimir Putin agreed to purchase the information feed and homepage of the nation’s hottest web site.
Yandex, also known as Russia’s Google, stated it was promoting its information aggregator, content material platform Zen and yandex.ru homepage to VK to deal with different enterprise areas, corresponding to meals supply and ride-hailing.
In change, Yandex will purchase meals supply firm Supply Membership from VK. Values for the belongings weren’t disclosed.
VK runs Russia’s largest social community, VKontakte, and an overhaul final yr noticed state-controlled gasoline exporter Gazprom and banker Yuri Kovalchuk, whom Putin has publicly known as a private pal, assume larger management over the corporate.
Vladimir Kiriyenko, the son of Putin’s first deputy chief of workers Sergei Kiriyenko, is its CEO.
Russia’s years-long suppression of unbiased media intensified after Moscow despatched troops into Ukraine on Feb. 24. It handed a regulation banning what it calls “false info” concerning the armed forces and quashing many organisations’ capacity to broadcast freely.
It has blocked entry to some international platforms, together with Meta Platforms’ Fb and Instagram.
“The board and administration of Yandex have concluded that the pursuits of the corporate’s stakeholders … are finest served by pursuing the strategic exit from its media companies and shifting to a deal with different applied sciences and providers,” Yandex stated in an announcement.
Yandex has, like many Russian corporations, had a turbulent few months. It plunged to a first-quarter loss and its shares tumbled to six-year lows earlier than buying and selling was suspended in late February. Revenues and earnings recovered within the second quarter, and whereas its Nasdaq-listed shares stay suspended, buying and selling in its Moscow shares resumed after a couple of month.
‘BUYING OUR FREEDOM’
Yandex has lately complied with Moscow’s calls for, underneath menace of fines, over which publications’ tales can characteristic on its information aggregator, drawing criticism from free-speech advocates.
Moscow has not blocked entry to most foreign-language media, which stay freely out there in Russia and on Yandex, however search outcomes do limit entry to any websites that communications regulator Roskomnadzor has banned, lots of that are Russian-language unbiased media.
In February, Yandex began warning Russian customers searching for details about occasions in Ukraine of unreliable info on-line.
A former head of Yandex Information, Lev Gershenzon, on March 1 described Yandex as a key factor in hiding details about the battle in Ukraine. Yandex has denied being complicit in censorship.
“We’re shopping for our freedom,” a supply near Yandex stated. “This enterprise had been such a weight on our toes.
“This can allow us to do our enterprise considerably depoliticised, virtually utterly depoliticised.”
ONLINE SEARCH
Yandex dominates Russia’s on-line search market with a share of round 62%, in line with its analytics software Yandex Radar. Google accounts for about 36%, with VK’s mail.ru at lower than 1%.
That stronghold over the web search market will doubtless proceed.
Yandex.ru shows a bundle of reports tales under its search bar, adopted by a rolling stream of content material. The corporate’s entry level for search will now turn out to be ya.ru, a website that resembles Google’s homepage and is already in style with those that desire uncluttered searches.
Yandex.ru, its Information feed and Zen, shall be renamed dzen.ru, Yandex stated, with VK to take over growth and management over “content material, feel and look”.
The asset swaps require anti-monopoly approval and are anticipated to shut within the coming months, Yandex stated.
E-COMMERCE SHAKE-UP
Search, promoting and ride-hailing are amongst Yandex’s strongest revenue-generating companies, but it surely has a number of different models, corresponding to cloud providers and self-driving automobiles. It’s increasing providers in Africa and Latin America, however pulling again from e-grocery in Europe.
The phrases of the deal look broadly impartial, stated BCS Specific in a be aware. The worthwhile Zen and Information divisions are optimistic for VK, whereas Yandex strengthens its place in foodtech with the doubtless loss-making Supply Membership, analysts stated.
Yandex’s Moscow-listed shares rose 2.7%, whereas VK’s depositary receipts have been up 2.9%, each outperforming the broader market.
Dmitry Masyuk, head of Yandex’s foodtech division, stated Supply Membership would enhance pace and selection on its meals supply providing. Yandex estimated the dimensions of the market at 650 billion roubles ($11 billion) in 2021 and sees annual progress of 20%, he stated.
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