Yandex has been on top when it comes to coverage recently and sharing another piece won’t be surprising. Unless it isn’t positive. BBC has mentioned that Yandex, Russia’s largest search engine has confirmed sharing confidential data with the state’s secret service; the FSB. Bad news, given that Yandex had set its eyes on raising $1 billion via listing on Nasdaq.
The issue comes forth with Yandex online payment system shared personal information about users to the FSB. The users were those involved in making donations to an anti corruption site launched by Alexey Navalny, a local blogger. The payment system addressed is the Yandex.Money recently covered by us.
It is quite a huge dent on the otherwise successful name in the Russian Internet arena. Yandex controls over 65% of the entire Russian Internet search market, making Russia one of those few countries where Google is yet to reign supreme. It also enjoys a fairly decent market share in other former Soviet states like Ukraine with 27% and Kazakhstan with 24% market share.
But all this fades when an agency interferes to such an extent where they actually force you to share your users’ data. There is little left to question transparency and intervention and it will have its impact on Yandex and many other Internet companies in the Russian region. Investors, for one will not be too keen to put their money where consumers’ privacy is not fully safeguarded.
But I doubt this is going to stop Yandex from pursing its IPO plans and also investors would pour in their money, given that they already invested in another big Internet brand in Russia, Mail.ru, which was last year.