Russia’s search engine can’t find an answer

Hey y’all, it’s Austin Carr in Boston. The so-called Google of Russia lost 60% of its market value last month. But first…Today’s top tech ne [View in browser]( [Bloomberg]( Hey y’all, it’s Austin Carr in Boston. The so-called Google of Russia lost 60% of its market value last month. But first… Today’s top tech news: - Russian [cyber attacks on Ukraine]( are ineffective - Google connected its [first subsea cable]( to Africa - GM [bought SoftBank’s $2.1 billion stake]( in Cruise Yandex.Spirals Yandex NV is Russia’s biggest technology brand, a dominant web and mobile service provider in businesses ranging from search to ride hailing. Once heralded for its [global ambitions]( and outmaneuvering of [Silicon Valley rivals](, Yandex is now at risk of slipping behind a digital iron curtain. Although it doesn’t have an exact corporate equivalent in the U.S., Yandex is often described as a [mashup]( of Amazon.com Inc., Google and Uber Technologies Inc. with tens of millions of Russians turning to the company for food delivery (Yandex.Eats), streaming content (Yandex.Music and Yandex.Live) and a Prime-like subscription bundle (Yandex.Plus). Until recently, shares of Yandex were soaring, hitting an all-time this past fall after the company [raised its sales forecast]( and expanded deeper into e-commerce. Then came Russia’s invasion of Ukraine, far-reaching Western sanctions against the country and a swift divorce from big-name tech partners and investors. Yandex’s stock crashed, [debt issues surfaced](, and the deputy chief executive officer and executive director, Tigran Khudaverdyan, [stepped down]( after the European Union imposed sanctions on him. It was a sudden halt. Just last month, analysts were lauding Yandex executives on their year-end earnings call for strong results. Khudaverdyan touted how Yandex facilitated 2.4 billion taxi rides in 2021, reached 12 million subscribers to Yandex.Plus and was looking beyond Russia. “For the last 20 years, we have invested significantly in R&D in Russia to create a world-class tech stack and win our domestic market from local and foreign competitors,” he said, noting that Yandex is looking at “international expansion opportunities” and aiming to “win in new geographies.” An accompanying [shareholder presentation]( compared Yandex to Alibaba, Amazon, Google and Tencent. Working with—or clobbering—Western tech companies was a part of the “tech-stack” strategy. Yandex beat out Uber in Russia and took a controlling stake in a [$3.7 billion joint venture with]( its San Francisco-based rival. Grubhub began experimenting with [Yandex.Rover robots](, and Yandex invested in [self-driving sensors]( for vehicle tests in the U.S. and a [grocery delivery service in the U.K](. Amid the company’s transition to more Amazon-like e-commerce during the Covid-19 pandemic, Yandex Chief Operating Officer Greg Abovsky [boasted that it could]( “build a FedEx in the space of a few months.” Those ambitions are now in jeopardy, at least outside of Russia. Uber said Russia’s war [catalyzed its divestiture]( from the joint venture with Yandex.Taxi (albeit after Yandex had said it [would buy Uber’s shares last August](). Grubhub ended its [Yandex robot partnership](. Mozilla removed [Yandex as an optional search provider]( from its web browser. And on Friday, Yandex said it was exploring a potential sale of its [news-aggregation service and infotainment platform]( called Zen. The challenges are [impacting the company’s ability to operate](, the Financial Times reported this month, citing a senior figure at the company. A Yandex spokesperson declined to comment on the company’s challenges but said in an emailed statement, “Yandex intends to focus on developing its other technology-related businesses and products (including search, advertising, self-driving and cloud) and transactional services (including ride-hailing, e-commerce, video/audio and streaming).” To be sure, Yandex remains Russia’s biggest search engine and ride-hailing app, and its isolation from the rest of the world could make it a stronger brand domestically. But it seems inevitable the global goals will be seriously handicapped if the “[splinternet](” continues, especially if [local talent flees](, [supply chains are choked](, [app store access]( becomes a hurdle and investments in everything from e-commerce to self-driving tech have no external conduit. Put another way, there’s not much point to building a “world-class” tech stack if it’s disconnected from the rest of the world. —[Austin Carr](mailto:acarr54@bloomberg.net) If you read one thing The company behind Baby Shark, the internet-born, mind-infecting phenomenon, is just getting started. South Korea’s Pinkfong has [a plan to reach an even wider audience](, which includes a movie, digital comics and, of course, nonfungible tokens. What else you need to know Speaking of crypto, the Wasabi digital wallet said it will [block certain kinds of anonymous transactions](. Meanwhile, an analyst said Bitcoin needs a macroeconomic “[vibe shift](.” The latest entry in the Final Fantasy video game series is so bad, it’s good. The soundtrack bounces from orchestral to Frank Sinatra, and the characters all stare blankly into the distance, which is what players might do before [realizing how much fun they’re having](. Ethereum’s creator is worried about the future of crypto. In Time magazine’s cover story, Vitalik Buterin is described as [the most influential person in crypto](—or at least, the most influential one we know. (We’re still searching for Satoshi.) Follow Us More from Bloomberg Dig gadgets or video games? [Sign up for Power On]( to get Apple scoops, consumer tech news and more in your inbox on Sundays. [Sign up for Game On]( to go deep inside the video game business, delivered on Fridays. Why not try both? Like Fully Charged? | [Get unlimited access to Bloomberg.com](, where you'll find trusted, data-based journalism in 120 countries around the world and expert analysis from exclusive daily newsletters. You received this message because you are subscribed to Bloomberg's Fully Charged newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. 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