VK Acquires Yandex, Google Is Russia, Freedom Of Information In Russia Is Rare

Yandex, now purchased by the Russian government controlled VK yuan. (photo: Twitter @yandex)

JAKARTA - The Russian government tightened its grip on the internet on Tuesday, August 23 when a state-controlled company with close ties to President Vladimir Putin agreed to buy Yandex, the country's most popular news aggregator and website.

Yandex, often referred to as Russia's Google, said it sold its news aggregator, content platform Zen, and homepage yandex.ru to VK to focus on other areas of business. They will focus on the food delivery business and online transportation services.

In exchange, Yandex will acquire food delivery company Delivery Club from VK. The value for the assets of the acquisition itself is not publicly disclosed.

VK runs Russia's largest social network, Vkontakte. Their major reshuffle last year has seen state-controlled gas exporter Gazprom and banker Yuri Kovalchuk, openly described as a true friend of Putin, take more control over the company.

They even appointed Vladimir Kiriyenko, son of Putin's first deputy chief of staff, Sergei Kiriyenko, as its CEO.

Russia's repression of independent media over the years has intensified after Moscow sent troops to Ukraine on February 24. Russia passed a law banning what it calls "false information" about its armed forces and canceling out the ability of many organizations to freely broadcast news about the activities of Russian troops in Ukraine.

They have also blocked access to several foreign platforms, including Facebook and Instagram Meta Platforms in an attempt to silence what they call "fake and untrue" news.

"Yandex's board and management have concluded that the interests of the company's stakeholders are best served by pursuing a strategic exit from its media business and shifting to a focus on other technologies and services," Yandex said in a statement.

Yandex, like many other Russian companies, has had a turbulent few months. They suffered heavy losses in the first quarter and the shares plunged to six-year lows before trading halted at the end of February.

Their revenue and profits finally recovered in the second quarter. However, its Nasdaq-listed shares remain suspended. But now trading in their shares in Moscow resumed after about a month of being frozen.

Yandex Sells Freedom

Yandex in recent years has complied with Moscow's demands, under the threat of fines, that the publication's stories can be featured in its news aggregator, which has drawn criticism from free speech advocates around the world.

Moscow has not blocked access to most foreign-language media, which remain freely available in Russia and on Yandex, but search results on the Yandex search engine, now restrict access to any sites banned by communications regulator Roskomnadzor. In fact, many of them are independent Russian-language media.

In February, Yandex began alerting users in Russia seeking information about events in Ukraine via unreliable online information.

A former head of Yandex News, Lev Gershenzon, on March 1 described Yandex as a key element in hiding information about the conflict in Ukraine. But Yandex denies involvement in news censorship in Russia.

"We bought our freedom," said a source close to Yandex. "This business weighs heavily on us. "This will allow us to do our business significantly depoliticised, practically completely depoliticised."

Yandex Online Search

Yandex dominates the online search market in Russia with a share of about 62%, according to the analytical tool Yandex Radar. Google alone accounts for only about 36%, while mail.ru VK is less than 1%.

The strongholds or restrictions on the online information search market are likely to continue in Russia.

Yandex.ru displays a collection of news stories below its search bar, followed by a scrolling stream of content. The company's entry point for search will now be ya.ru, a site that resembles Google's homepage and is already popular with those who prefer a neat search.