Pavel Durov the former CEO of Russia's main social network, VKontakte and founder of Telegram quit his job at the beginning of this month saying, "it has become increasingly complicated to stick to the principles we once founded our social site upon.” Speculators gave an educated guess that Russian authorities have been pushing for more and more censorship on the site. Two days later, he apparently "unresigned," but that wasn't the end of this story.
Druov no longer wishes to work in Russia and moved the Telegram team in central Europe, and posted on Facebook that the team is looking for a location to set up with safe harbor. Telegram is a heavily encrypted messenger app.
“No IPO is being planned. Facebook’s IPO has destroyed the trust of many individual investors in social networks, so [our] IPO is postponed indefinitely,” Vkontakte’s founder and co-owner Pavel Durov tweeted on Monday, answering a Russian journalist’s question. Durov had expressed his IPO intentions a mere five months ago at the DLD tech conference in Munich.
According to a poll conducted by the Public Opinion Foundation (FOM) earlier this month, Odnoklassniki.ru has become Russia’s most popular social network among Russians who are 18 year-old and over – ahead of Vkontakte.ru, whose leadership is more affirmed among teenagers.
Odnoklassniki’s reach is now estimated to be no less than 61% – compared to 51% for Vkontakte, 28% for Moi Mir and just 12% for Facebook – of a total of 57.8 million adult Internet users in Russia, FOM reported.
Pavel Durov, founder and CEO of Vkontakte (Russia's biggest social network) prefers to keep a low profile in the media. He rarely gives interviews and almost never looks in the camera when his photos are being taken. Though he frequently addresses the 2.7M audience of his personal blog and this month Pavel gave an extensive interview to Forbes.ru. The article gives an insight on Pavel's early days and Vkontakte's future plans. Perhaps the interview itself was part of the company's strategy of raising its profile before entering other markets and possibly going public. Rumors about Vkontakte's IPO resurfaced a few weeks ago but has been unconfirmed so far. Vkontakte was founded in 2006 by Pavel and two of his friends. Today the social network attracts the largest audience with estimated 26 million unique daily visits. Read on to learn how it all started and where the company is at right now.
The move to a shorter and simpler .com domain is associated with Vkontakte's efforts to expand their global reach. As Ilja Perekopskij, Vice-President of Vkontakte, told Forbes, international expansion (starting from Europe) is one of the company's key strategic goals for 2011. Vk.com is shorter, simpler and easier to remember for foreigners claimed Pavel Durov, founder and CEO. Vkontakte's revenue and user metrics are looking really good so far. According to Ilja Perekopskij, in 2010 the company's turnover was $98.3M, $44.76 of which came from advertising. Now their monthly revenue is $8-9M, 60% of which comes from advertising, 30% from applications and 10% from other services. By the end of the year Vkontakte plans to increase their revenue by 70%-100% compared to last year.
In the previous post we introduced the latter half of the top ten Runet's movers and shakers. Now is the time to talk about the top five. But first a few words about the rest of the high-flyers on the Forbes top 30. The types of companies top executes belonged to varied: from social networks, game-developers and e-commerce sites to recruitment website HeadHunter (owns up to 50% of marketshare and earned $1.7 in first half of last year) and antivirus software Kaspersky Labs (4th largest in the world with income of over $500M last year alone). Founders of internationally known services like Evernote (Stepan Pachikov) and Chatroulette (Andrey Ternovsky) were placed 13th and 15th respectively. Evernote attracted $20M from Sequoia Capital in 2010 and Chatroulette was one of the most talked-about services that year.
Forbes.ru has recently published a list of 30 most notable web players in Russia. Judging by the results, the most influential people in Runet have been in the business for decades. There are some young talents there too, though very few. Internet market is clearly dominated by local businesses: the only person working in a foreign company, placed 25th, was Vladimir Dolgov, the head of Google Russia. One-quarter of all the people on the list belonged to Mail.ru Group, clearly the most prominent player of all. Investors ranked much higher than founders of recent services and unsurprisingly the list included only two women. In the first part of presenting the list, we looked at the latter half of the top 10 movers and shakers of Runet.
Last week Vkontakte quietly removed it's open registration policy - you can now create an account only through an invitation. It was announced on the company blog that only users that have tied their accounts to their mobile phones would be able to send invites to new users. Supposedly the new invite system makes the registration simpler and safer. Simpler because when inviting someone you can already indicate their name, birthday and school, making it easier for non-tech-savvy users to create an account. Safer because it reduces the number of fake accounts and bots entering the system. So is Vkontakte aiming for exclusivity all of a sudden or is there something more to it?
Russian internet market is scarcely covered outside of the country but it's not for the lack of news. The main obstacle is language: most online services are oriented towards domestic market and are hence mostly in Russian. Another thing is innovation: there are few companies (if any) that have come out of Russia with truly ground-breaking ideas - most of the services are copies of similar American websites. Nevertheless, the number of internet users is growing together with the size of their pockets. Hence, a number of companies managed to build impressive userbases, make big bucks and dodge the competition from abroad.
According to the latest numbers released by TNS Russia and comScore, the top websites are:
Mail.ru, former Digital Sky Technologies from Russia, is filing for an IPO in the London Stock Exchange. The company has received quite a bit of publicity in the recent years as it has invested into some high flying internet properties including Facebook and Zynga. Reuters reports that sources close to the deal say the IPO has been oversubscribed with more than two weeks left before pricing.
Russian social networking site Odnoklassniki.ru has hit 30 million registered users, according to Quintura. Odnoklassniki is a relatively young social network, only 3 years old. The site was launched in March 2006.
Odnoklassniki has some interesting statistics as well. It has about 8 million visitors each day. Odnoklassniki's biggest competitor in the Russian market is Vkontakte, which has some 28 million registered users and 1.4 billion pageviews per day. According to the Russian TNS Web Index Vkontakte had 13.09 million visitors a month, which is slightly higher than Odnoklassniki's monthly audience.
The Russian social networking market is the fourth largest in Europe after UK, Germany and France.