Profile: Yandex NV (YNDX.O)
17 Apr 2014
Yandex N.V. (Yandex), incorporated in June 2004, is an Internet company in Russia. During the year ended December 31, 2011, the Company generated 63.3% of all search traffic in Russia, and 60.6% in December 2011, and its Yandex sites attracted 45 million visitors in December 2011. It also operates in Ukraine, Kazakhstan, Belarus and Turkey. Yandex also aggregates and organizes local, national and international content and offers a range of additional services. Its search and a number of its services are location-based and are available in versions tailored for mobile and other digital platforms and devices. The Company offers access to its search engine through personal computers, mobile phones, tablets, and navigation and other digital devices. It also offers a range of specialized search, personalized and location-based services, including Yandex.News, Yandex.Market, Yandex.Mail and Yandex.Maps. In November 2011, the Company acquired SPB Software. The acquisition consisted of SPB Software, Inc. (US), SPB Software Limited (Hong Kong) and SPB Software Co. Limited (Thailand), and the assets of Phonesoft Consulting Ltd. (Russia). In August 2011, it completed the acquisition of a 9.7% interest in Blekko.com, Inc., an Internet search company. In July 2013, the Company and Sberbank of Russia OJSC announced that the completion of the previously announced joint venture for electronic money solutions. Under the terms of the deal, Sberbank has acquired 75% interest (minus one ruble) in the charter capital of Yandex.Money. In October 2013, Yandex NV announced the acquisition of KinoPoisk. In March 2014, Yandex purchased KitLocate, which is a developer of geolocation technology for mobile devices.
The Company’s search engine offers access to a range of information available online. It utilizes linguistics, mathematics and statistical analysis to develop algorithms that extract, compile, systematize and present relevant information to users. Yandex supplements the results from its main Web index with results from its parallel search system, which blends listings from all available Yandex specialized and vertical searches according to their relative relevance, such as Yandex.News, Yandex.Market, Yandex.Maps, Yandex.Music, Yandex.Image and Yandex.Video. Yandex search is responsive to real-time queries, recognizing when a query requires the current information, such as breaking news or the most recent post on Twitter on a particular topic. Yandex.com is its platform for beta testing and improving non-Russian language search, and in 2011, it launched yandex.com.tr, its Turkish language search product.
The Company’s users can find answers to their questions through its search box, as well as to their questions through current news, weather and road traffic reports, television and movie schedules, and other services. The Company enables users to customize its homepage to their personal interests. Users can select from more than 8,000 third-party and widgets (add-on Web applications) to add to the Company’s homepage. Roughly one out of every five Yandex users chooses to customize the Yandex homepage. The Company also offers localized homepages for specific geographic markets. The Company’s Ukrainian homepage is yandex.ua, its Kazakh homepage is yandex.kz, Belarusian homepage is yandex.by and its Turkish homepage yandex.com.tr.
Specialized Search Services
The Company in addition to its search engine, offer specialized search services. Yandex.News is the Company’s news aggregation and information service, the online news aggregation service in Russia, providing media overview for its Russian, Ukrainian and Turkish audiences, aggregating and presenting local, national and international news, from more than 4,000 news sources worldwide. Yandex.Market is the Company’s price comparison service, providing product information, price comparisons and consumer-generated reviews of products and online retailers. The Company aggregates price, product and availability information from thousands of active online and brick-and-mortar retailers, and feature more than 150 product categories and more than 600,000 product makes and models. It provides a number of other targeted and seasonal search services, including for images, video, music, theatre, television, weather, jobs, transportation, cars and real estate.
Yandex.Mail provides users access to their e-mail accounts, featuring social authentication via their accounts on VKontakte, Odnoklassniki, Facebook, Google, Mail.ru or Twitter, through a user interface, message display and unlimited storage space. A number of features are available, including threaded and unthreaded views; Autotagging, which automatically recognizes and tags certain types of e-mails; Smart first lines, which allows its users to see the first line of any e-mail in their inbox without having to open it, and Address book, which recognizes and links both Latin and Cyrillic transliterations of names, and aggregates all e-mails from the same sender regardless of the language used. The Company’s mobile push-email technology allows for the delivery of new e-mails to mobile inboxes. Users can also send and receive instant messages and communicate their coordinates through Yandex.Maps, and the service recognizes and allows users to call phone numbers in e-mails. Yandex.Mail also offers users the ability to create personal domain e-mail accounts, with all the features available to users of Yandex.Mail. Yandex.Mail is also equipped with Dr.Web, a third-party Russian antivirus program. In December 2011, Yandex.Mail had 17.6 million users.
Maps and Location-based Services
Yandex.Maps service is the map service in Russia, with 13.9 million visitors in December 2011. This service provides detailed maps of more than 200 cities and towns in Russia and approximately 60 cities in Ukraine, Kazakhstan and Belarus, as well as a detailed map of Turkey. In addition to graphical maps, the Company offers satellite images and hybrid maps (an amalgamation of satellite images and graphic maps), panoramic views, public transportation routes and driving directions in browsers and mobile device applications. Its mobile version of Yandex.Maps allows users to determine their current location, to find a nearby business, to monitor road traffic congestion along particular routes and to determine the routes based on real-time road traffic congestion updates. Mobile Yandex.Maps is available on a variety of mobile platforms. Yandex.Maps is also available via application programming interfaces (APIs), which allow Web developers to embed and use interactive maps in third-party Websites for free, together with the ability to add extra layers of information. The Company has partnerships with local directories that allow it to integrate local business listings, recommendations and user reviews in the Company’s maps, and has launched its Geo-Direct Business Directory service to enable advertisers to pay for placement in order to enable users to find them more easily. The Company also offers real-time road traffic congestion monitoring in cities through Yandex.Traffic.
The Company offers downloadable applications for mobile and digital platforms and devices, and has introduced mobile versions of a number of its services. The Company supports mobile phones, tablet devices, Internet-connected televisions and navigation devices. Its mobile applications include Yandex.Maps, Yandex.Search for Mobile, Yandex.Mail, Yandex.Money, Yandex.Market, Yandex.Taxi, Yandex.Fotki, Yandex.Metro and Yandex.Timetables. Yandex is included as the default search engine on certain mobile handsets sold in Russia, including the Windows Phone 7 smartphones by Nokia and HTC and Samsung's Bada-based devices.
Yandex.Bar is the Company’s specialized toolbar for Web browsers, offering search and access to updates from personalized services, such as Yandex.Weather and Yandex.Traffic. Yandex.Bar is compatible with Web browsers, including Mozilla Firefox, Internet Explorer, Safari, Opera and Chrome. Punto Switcher is its automatic Russian-to-English and English-to-Russian keyboard layout switcher. Punto Switcher automatically detects the language used and switches the keyboard layout as required. It also allows modifications of standard key combinations for basic computer commands. The Company offers customized versions of Yandex.Search and other Yandex features and services for most browsers, including Mozilla Firefox, Internet Explorer, Opera and Chrome.
Yandex.Server is the Company’s server application for indexing and searching files in various formats. Formats, such as Web servers, local networks and database management systems.
Monetization and Advertiser Services
Yandex offers advertisers both text-based advertising and display advertising. It also offers Yandex.Market, the Company’s price comparison service, which provides another platform for retailers. The Company revenues are generated from text-based advertising, on a pay-per-click basis, with a portion generated from display advertising, based on the number of impressions delivered. Yandex monitors the advertisements it serves, both automatically and manually. Yandex.Direct is the Company’s auction-based advertising placement service, which uses auction theory and relies on its distributed infrastructure to process millions of auctions every day. Yandex.Direct lets advertisers deliver relevant text-based ads targeted at particular search queries or content on Yandex Websites or third-party Websites in the Yandex ad network. Yandex.Direct enables advertisers to present advertisements to users at the precise moment they are looking for information related to the advertiser's product or service. Yandex.Direct features an automated online sign-up process that enables advertisers to launch their advertising campaigns. Advertisers may access Yandex.Direct through interfaces in Russian, Ukrainian and English.
Text-based advertisements on the search engine results page (SERP) appear in one of three general categories: top placement (appearing above the organic search results), guaranteed placement and rotation (both appearing to the right of the organic search results). In addition, Yandex.Direct identifies advertisements that contain information that is subject to mandatory legal licensing or disclaimer requirements, such as advertisements for pharmaceuticals, and places the required legal disclaimers next to them. In addition to auction-based sales of text-based advertisements, the Company offers display advertisements. The Company allows advertisers to place display advertisements on its homepage, as well as other services, including Yandex.Mail, Yandex.News and Yandex.Weather. It also offers a media-contextual banner, a display product that is only shown to users who search for certain topics on Yandex.Search or visit sites of the Yandex ad network dedicated to a particular area of interest. In 2011, the Company launched Crypta, which works alongside its machine learning mechanism MatrixNet.
The Company’s Yandex.Market price comparison service gives retailers a platform to reach customers seeking specific retailer, product and price information. Retailers submit their product catalogs and price lists to the Company in a structured online format, enabling it to provide detailed information in response to relevant user queries, either through its search engine or its Yandex.Market service.
Yandex Ad Network
The Company’s Yandex ad network partners include search Websites, for which the Company provides search capabilities, as well as contextual network partners. Through the Yandex ad network, its partners can deliver Yandex.Direct ads on their search results pages or Websites. Its technology offers relevant ads by analyzing the search results or content of partner Websites and pages, as well as the search history, behavioral patterns and location of users. The Company screens applicants for the Yandex ad network.
Yandex Location-Based Priority Placement
The Company, through partnerships with regional business directories, the Company compiles and updates its own Yandex.Spravochnik, a business directory covering the whole of Russia and other neighboring countries. Yandex.Spravochnik data appear both in its search results and on the Company’s maps, including its mobile application, in response to search queries within the specified area. In January 2011, the Company launched its Geo-Direct Business Directory service, which allows businesses to pay for a placement on its maps, including maps returned in the Company’s search results, highlighting their address and allowing users to access their contact details.
Yandex for Businesses
The Company offers a number of free services and tools designed for businesses. Yandex.Webmaster service allows Webmasters to control how their Website is seen by the Company’s search engine. In addition, the Company’s Web statistics analysis tool allows Website owners or Webmasters to measure traffic to their sites, see where the traffic is coming from, track visitor behavior, record time spent by visitors on a Webpage. Yandex Site Search is a search tool the Company offers to Webmasters and Website owners, which allows them to provide their users with search functionality on their own Websites. Yandex.Mail for Domain Owners service allows users to create e-mail accounts with their own domain names. Yandex APIs and Widgets APIs enable developers to use Yandex technologies in their own businesses. Yandex.Money is the Company’s online payment system. As of December 31, 2011, Yandex.Money had more than 10 million registered users, and processes more than 100,000 payments daily for thousands of participating merchants, including a range of Russian and international companies. Yandex advertisers can also use Yandex.Money to pay for advertising placed through Yandex.Direct. In 2011, approximately 50% of its advertiser invoices were settled through Yandex.Money.
The Company competes with Google, Mail.ru, Microsoft, Yahoo!, Rambler, Begun, Facebook, Twitter and Vkontakte.
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