Yandex, Russian Google, is a multibillion-dollar technology company that dominates the country’s e-commerce. The firm offers customers everything from search engines, food delivery, car-sharing, and online marketing. Now that Russia is bombing Ukraine and the West is hitting Russia with disastrous sanctions, the company’s future is in doubt. Yandex announced the resignation of two board members on March 7. One week later, the Deputy Chief Executive Officer resigned; After it was imposed EU sanctions. Yandex then announced plans to sell two of its most prominent content divisions to focus on other businesses.
At the same time, Western sanctions have led to the freezing of the company’s shares on U.S. stock exchanges. This, in turn, forced shareholders to seek to repay bond guarantees. However, the company says it does not have $1.25 billion to cover that amount.
Now traded shares had fallen by almost 80% compared to November When the strengthening of Russian military forces on the Ukrainian border first began to attract public attention. This has destroyed more than $20 billion in market capitalization. According to Esther Dyson, a well-known American technology consultant, the future of Yandex depends on the end of Russia and not the other way around.
Tonia Samsonova ran a question-and-answer service called Yandex. Q resigned earlier this month in protest. He also accused the company of censoring the Ukraine war from its search engine and news service, Which collect millions of views daily. After the government of President Vladimir Putin seeks to exercise loyalty and silence the opposition to the war, Yandex risks becoming a propaganda engine for dictatorship.
The Kremlin has been destroying independent journalism and media companies for years; it used a foreign agent’s law to punish several publications and individual journalists.
Media and War
Following the invasion of Ukraine on February 24, the authorities took further steps to criminalize independent coverage of the war; Dissemination of “intentionally false information” about the use of the armed forces is punishable by imprisonment. It is also prohibited to defame the military.
The Russian media, including the most prominent independent media outlets, have found a queue. Some influential organizations closed; Journalists began to flee the country. Yandex Home Page is the leading Russian-language news portal; Like Google in the West, it is a significant traffic driver to other news releases. Yandex News has about 30 million Russian users.
However, the headlines began to attract readers to the official, state, or state-affiliated media companies. War or invasion of the words of Yandex News, the search did not yield any results. On March 1, the former head of Yandex News posted a letter on Facebook. He accused his former employees of collaborating with the Russian state by hiding the news of the war.
The basis and driving force of the war are that a significant part of the Russian population can believe that there is no war. Yandex today is a critical element of hiding war information. Every day and hour of such “news” is a human life.
Yandex and Risks
On March 18, Yandex announced plans to sell Yandex News and Yandex Zen, an informational entertainment channel. Instead, focus on developing other businesses, such as taxi services, e-commerce, self-driving cars, advertising, and other companies.
One of Yandex’s longest-serving board members, Dyson declined to give further details if things led to his resignation. In the current Russian political environment, it has become impossible for the team to provide a free and open information platform to the Russian public at the risk of breaking the law and the company and its employees; The company said in a March 7 statement announcing its resignation.
On March 2, Samsonova, who had been in talks for several months to leave the company, resigned because Yandex did not publish information on its Yandex.ru homepage that Russian forces were bombing Ukrainian cities. It also kills innocent people. Before the war, the screws were already tightened in Yandex; The firm currently employs about 18,000 people, headquartered in Moscow.
Three years ago, the Kremlin sought to change its governing structure and essentially sought a veto on its council. The compromise plan reportedly led to the government taking two seats on the board and a gold share; This allowed the state to block transactions; The management of Yandex has also been temporarily removed if it considers it in the national interest.
The effort also coincided with the pursuit of Michael Calvey, an American investor who made a $5 million pre-investment in Yandex two decades ago. Calvey’s prosecution, which received 5 1/2 years probation for embezzlement, alarmed the Russian and foreign business community.
Yandex’s revenue, primarily driven by advertising, could shrink in the Russian economy, experiencing its sharpest contraction since at least the 1990s. Economists say Russia’s gross domestic product could shrink by 15 percent. Other Yandex businesses continue to generate significant revenue for the company beyond content. Yandex Eats, for example, is a leader in food delivery, a service that flourished during the COVID-19 shutdown in Russian cities.
This week, Yandex Eats was in the news after hackers hacked into and leaked a database containing thousands of names and addresses across Russia. Regulators said an investigation was underway. Samsonova predicted that Yandex would continue to operate in Russia even when the government further restricts the free flow of information. According to him, Yandex will stay in Russia; the company will go nowhere.