Yandex’s sale of media assets to VK includes yandex.ru homepage – TechCrunch

Russian search giant Yandex has completed the sale of its two flagship media properties to local rival VK, owner of the eponymous social network.

The agreement to sell the products, Yandex’s algorithm-sorted news aggregator (News) and blog recommendation platform (Zen) was signed in April. But today binding agreement goes further than that – also including selling the main page, Yandex.ru, which integrates News and Zen content into the search page, turning it into an information-rich portal (critics say misinformation-rich) by presenting a number of infinitely scrolling content streams.

This means that once the sale is over, visitors browsing Yandex.ru will be redirected to a renamed version of the page, dzen.ru, which will be controlled and developed by VK, the new owner of Yandex’s two multimedia products.

We also understand that the VK version of the Yandex.ru portal will still feature Yandex’s search service, but just as a standard iframe integration (meaning it won’t have access to search data). So, for regular users of Yandex.ru, the only immediately obvious sign of the change in ownership will be the redirected URL.

As we reported in June, Yandex signaled an impending shift in focus to an alternative local homepage, ya.ru — a simple search portal it’s owned for decades alongside the Yandex page. ru denser, where news content dominates the experience. . This latest portal has increasingly become a major reputational headache for a company that prefers to pretend it is just a neutral tech company. So it’s easy to see the appeal of Yandex moving to a simple, search-focused homepage.

“Yandex’s board and management have concluded that the interests of the company’s shareholders, including its Class A shareholders, are best served by pursuing the strategic exit of its multimedia (non-streaming entertainment) business. and focusing on other technologies and services, including search, advertising, online and offline transactional activities and a number of b2b technology companies, among others,” the company wrote in a statement. press today.

“The board of directors has approved the transaction. In accordance with this strategic direction, ya.ru will become the main page of Yandex and the key entry point into search, mail and other non-media services,” he added, indicating the main service of the new main page and a new Android. The app he is launching, centered on his AI assistant technology, called Yandex with Alice, will be his search engine.

“After the transaction is completed, the current main Yandex app for Android will change its name to Yandex Start. It will then work as a browser, and users can choose the start page in their settings. The Yandex app for iOS will continue to function as before, but without Zen or News.

“After completion of the transaction, the current main page with News and Zen will be renamed to dzen.ru and will be developed and controlled by VK (including control of appearance, content, etc.). Trademarks and technologies Related News and Zen will also be transferred to VK.

A source familiar with the matter told TechCrunch that selling content services has become “a strategic priority” for Yandex since the outbreak of war in Ukraine, which led to a sharp increase in Russian state censorship. “It has become very difficult to remain independent in the presence of services like News and Zen,” they hinted.

Yandex has faced heavy criticism over its platforms’ role in spreading and amplifying state propaganda from jailed Kremlin critic Alexey Navalny – who, in a public attack earlier this year accused the company of a “solid, barefaced lie” in claiming to display “news” on its homepage, given how its news feed amplifies state propaganda.

A number of senior Yandex executives have also been sanctioned by the EU – although the company itself has so far escaped official sanction.

It remains to be seen whether the sale of the two major online content conduits that the Kremlin has, through a regime of tighter media licensing and regulation, been able to appropriate to amplify its talking points, will enable the reboot sought. of Yandex’s reputation.

The price tag for Yandex for media release looks high as it essentially loses the ability to use its own locally trademarked trademark by ceding control of the Russian portal (and all the traffic it generates) to Kremlin-linked rival VK. – which only seems ready to deepen the state’s grip on the digital infosphere in the country.

In return, Yandex is acquiring 100% of VK-owned food delivery service Delivery Club “in return for these assets”, as its press release states – confirming that no monetary payments are tied to the deal. (And on-demand delivery is hardly a poster child for post-pandemic success, with meal delivery platforms hit by declining consumer demand as the global economic downturn and inflationary pressures kick in. )

“Delivery Club, Russia’s leading food and grocery delivery service, will be part of Yandex’s e-commerce, mobility and delivery segment,” Yandex said. “Once the transaction is complete, users will be able to continue using the Yandex Eats and Delivery Club apps, while couriers, in collaboration with Delivery Club, will join the Yandex Pro technology platform. Yandex intends to maintain the brand Delivery Club.

The sale of Yandex’s media properties still needs regulatory approval – with the company noting that it is subject to anti-monopoly approval in Russia, but adding that it expects the deal to close in ” the coming months”.

“We couldn’t get rid of News and Zen any other way,” our source familiar with the matter told us, suggesting that the requirement for the Kremlin to approve major business changes has limited Yandex’s options.

Return in 2019the Russian company agreed to a corporate restructuring that increased Kremlin control over the company by granting veto power over key company decisions (including intellectual property) to a body closely tied to the government.

“It was actually the only way to focus on technology. We have a lot of people working at Yandex. We didn’t want the company to close,” the source added. take for us, but there was no other way to deal with it.”

Earlier this year, in an interview with TechCrunch, former Yandex Deputy CTO Grigory Bakunov told us that the company’s management was naïve to the risk of a Kremlin takeover of tech algorithm-based content sorting systems they were developing – and its executives dropped earlier chances of proactively shutting down products than the state could, through a combination of legislation, regulation/licensing and en installing state supporters on Yandex’s board, to “virtually take control” by 2017 (with the passing of a law requiring news aggregators to only use government-approved sites State as sources of information).

The strange prospect of a local internet giant passing its own branded search portal – and all the traffic it attracts – to a rival is just the last ‘through the looking glass’ moment for the Russian Internet since the Kremlin took the decision to invade its neighbor. In another example earlier this summer, Yandex chose to erase national borders from its Maps app in a bid to circumvent political pressure over where the software drew borders in Ukraine.

Stricter Kremlin regulation of search services inside Russia could still bring more such painful passes to Yandex.

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