The main theses of the general director of "Yandex" Alexander Shulgin from an interview with the newspaper "Kommersant"

General Director of Yandex, Alexander Shulgin, gave a lengthy interview to the Kommersant newspaper. This is the first big interview of the new head of the Russian office of “Yandex” since taking office.

The conversation turned out to be large-scale and covered a lot of topics: from the search business and the opposition of Google, the impact of the crisis on business and the future prospects of the largest Russian IT company.

"Megamind" cites the main points that were voiced in the interview.

On the antitrust case "Yandex" against Google

Our position is very simple: as soon as you become a monopolist, you cannot use dominance in one area to promote your products from a completely different area. These are antitrust rules in all developed countries.

Now it is not just a big player: in all dimensions, Android devices have a world share above 80%. Super success, like Microsoft has in their time on computers. It would seem, reap the benefits, distribute your operating system. But they went further, which seems to us completely unfair to other players: in particular, to such as we. They began to limit the pre-installation of our services on manufacturers' devices.

At first, we faced limitations in the pre-installation of our services on the main screens of devices of the world's largest manufacturers. We have put up with this for a long time, without losing a single opportunity to work with our partners. But last year, Google went further and began to introduce a complete ban on the pre-installation of all Yandex services on smartphones of brands for which Russia was the main market.

When some manufacturers get a complete ban on the installation of our services, it seems, in exchange for some share of Google search revenue. This is their contractual relationship, but the fact is that we worked with all three manufacturers — with Explay, with Fly, and with Prestigio — they had pre-installed our services, we had commercial, mutually beneficial relationships with them for several years. But at some point, our long-time partners were forced to say: “That's it, we can’t bet more than you — this is Google’s requirement.”

We never owned the operating system. In the PC world, there was Windows; they handed out Internet Explorer, which was at one time the main browser. Our answer was to make an excellent quality product that people would choose for themselves. In the world of closed platforms, the answer is the same: make great applications that people choose for themselves. If our product is good, then we will get our market share, but the means of delivering the product to the user are also important. Still, even now, although our ability to promote applications of “Yandex” on Android is very limited, our search share on this platform reaches 44%. The number one goal is a quality product, the second goal is to provide the opportunity to deliver your product to users, and our application to the FAS should help solve this problem. We want to ensure that all application and service developers have equal opportunities to promote their applications through pre-installation on the Android OS.

About partnership with other companies within the FairSearch Alliance

Microsoft is part of the Fair Search Alliance, according to which the European Commission is investigating Google’s actions on Android in Europe. Last year, we were attracted by a witness in this investigation, since Yandex was one of the few Google search competitors. Fair Search has common interests in creating equal conditions for all games on Android. In a recent statement, the Fair Search Alliance, which includes Microsoft, Oracle, Nokia, Expedia, TripAdviser, and many others, supported our application to FAS.

On future plans for the development of the company

I am sure that Yandex has a lot of growth potential. The company developed rapidly on products created in the early years of Yandex - search, advertising technologies, mail, maps, etc. The portal’s audience is almost the entire audience of the Russian Internet, and the Internet as a sector is increasingly increasing its share in the total advertising pie (according to ACAR, in 2010 the share of online advertising in the advertising market was 12%, and in 2014 - almost 25%). Of course, when you become big, then, as in all industries, growth slows down. But Yandex has a world-class technological potential. I see serious opportunities for expansion in Russia, and for certain areas - and a good opportunity to go beyond Russia.

Firstly, in Turkey, we continue to deal with the quality of products and would like to increase the share of our search. Luring the user to him is a difficult task, so the quality of the product is a necessary condition for this. But it takes time and effort to convince Turkish users that an equal sign can be put between “Yandex” and “excellent”.

Secondly, another development direction is products for business. In our case, these are Yandex’s advertising technologies; we will also invest in them. The barrier to the transition to a new service in this area is relatively low.

The third is that for us a few years ago it was a mystery - the mobile direction. In some areas, we are fine. For example, our geo-applications - “Maps”, “Navigator”, “Transport”, “Metro”, and “Parking” - are very popular, we can see it by the audience, by reviews. But obviously more needs to be done. We will invest resources in the mobile direction.

On the impact of the crisis on the company

We live not in one day. Crises come and go, it is not known how long this will last. Our goal is to ensure the development of the company for years to come. Therefore, we will do the same thing that we did in the last crisis: we focus on what is most important for the company. Now this is a search, advertising technologies, these are our new business initiatives. For example, niche players like Yandex.Taxi — against the background of all Yandex, this is not a very big project, but it is growing very fast.

The company has been actively recruiting people in recent years; we have grown at a slightly faster pace compared to the market and in relation to the growth of our revenue. Just for statistics: in 2013, 1900 people came to Yandex, 650 resigned or were fired, and in 2014, 1500 and 750, respectively.

About the advertising component

Almost all advertisers that are on TV also have Yandex. We still have different products.

As for the similarity in advertisers, already in 2010, the largest advertisers of Yandex were well-known brands, and their advertising budgets amounted to several million rubles a year. But, since the number of advertisers in “Direct” is very large, even the largest advertising budget in “Direct” does not exceed 1.5% of the total revenue of “Yandex”.

On the costs of "Yandex"

We usually invest in data centers. And this is the same as the search, more than 2/3 of our entire CAPEX goes to the server search equipment. And in 2015 we will continue to invest in it. Perhaps even at an accelerated pace, because we see, on the one hand, the need, on the other - the possibility of increasing the search base.

On the income of "Yandex"

In this economic situation, it is difficult to predict for the year ahead. I do not want to not meet the expectations, giving too optimistic figure. On the other hand, I don't want to frighten people in vain, because - what if it turns out better? The horizon of vision that we have, for the quarter, we can make public. In principle, this is often for Internet companies: Google does not give forecasts at all, Baidu gives for a quarter, although the situation on their markets is much more stable. When everything was stable in Russia, we gave for a year, now it seems unjustified.

Auto.ru

“Yandex” exists to solve people's problems, to satisfy their need for information, to connect the offline and online world in this area. We bought Auto.ru to do what, in our understanding, would be the best service for buying and selling cars. Primarily for individuals, for those who sell their own cars, but also for car dealers. This is the purpose of the transaction.

"Film Search"

We plan to add the ability to watch movies online, but we will not own this content ourselves, but will attract a large group of partners who will provide content. The main value we want to create for users is the recommendation system. Sometimes the choice of a movie takes more time than it is in principle to watch it. We want to make technology recommendations, which saves time and allows you to discover new movies.

We will work on the basis of different models. Do not forget about advertising, which can be shown when viewing content and thus pay for viewing. We will not decide for our partners, they will be free to choose.

Yandex browser

The new alpha version was perceived by the professional community very positively. We will gradually transfer those ideas that are presented in the alpha, in the main product. Last year there were only two growing browsers in Russia - Chrome and our browser. According to LiveInternet, in February 2015, the Yandex Browser became the second most popular browser on the desktop in Russia, ahead of Firefox, Internet Explorer and Opera.

About "Data Factory"

The goal we want to reach in a few years is to provide an online service to clients from the corporate sector. And it looks like this: the client loads its data in a structured way, and the algorithms and robots on our side extract useful recommendations from this data so that the company can improve its performance. This is called predictive analytics (predictive) and even prescriptive (prescriptive). Ultimately, the Data Factory should become a corporate tool that can be scaled to fit the tasks of thousands of different customers from different areas.

Now our technologies are being worked out on individual solutions. From the stage of the pilots go to real projects, but since we start from scratch, then any new client we have to do a pilot on a test database. When we prove to ourselves and the client the effectiveness of the first pilot, we turn to a partnership on commercial terms. For example, by order of Rosavtodor, we made a system that can predict traffic jams and accidents. And for Wargaming, they learned how to predict the outflow of World of Tanks players. Our customers include Astra Zeneca, Opera Software, Intel. These are not the only examples, but only those about which we can speak.

About Yandex.Taxi

Taxi service is useful in very large cities. Now focus on Moscow first. In the second - Peter. We also see a huge number of opportunities to improve the quality of service and develop it as a business. A lot of work.

The ideal situation is when all competitors reveal their results and then you understand where you are relative to the market. It makes move faster. It is very useful when you understand what is happening. But in the market for taxi services the situation is opaque. We are a public company, we show, and no one else. It turns out that we are in an unequal situation with the others, because everyone can compare themselves with us, draw conclusions and run faster.

About Yandex.Market

We saw at the end of the year that CPA began to grow faster, but I cannot say that a breakthrough happened there. We still have linear growth, although it has accelerated. No one was waiting for the instant transition of “Market” to a new business model. But the plans and intentions remained the same: to promote the marketplace, the CPA model, expand the categories of goods and go to the regions.

On the involvement of Arkady Volozh

Physically or with the help of various means of communication, Arkady is involved in all important events. He is still involved in the life of Russian “Yandex”. Due to the fact that I am engaged in operating activities in Russia, he devotes more time to the international direction. But the Russian Yandex, of course, did not completely leave. Still with us.