Russia plans state-backed web search engine named after Sputnik (report)


MOSCOW (Reuters) – State-controlled telecommunications group Rostelecom is planning an internet search engine named after the Sputnik satellite, the Vedomosti newspaper reported on Friday, although analysts said the goal of penetrating the market highly competitive Russian was doomed to failure.

A woman walks past an office of the Russian telecommunications company Rostelecom in Moscow, November 21, 2012. REUTERS / Maxim Shemetov

The government has taken steps to tighten control over the internet, but a state-backed search engine, said to be called, is reportedly facing search engine company Yandex, with 62% of the market. , the American giant Google and Mail. Ru.

“Search engines are a completely different area from the telecommunications services industry in which Rostelecom is involved,” VTB analyst Ivan Kim said in a research note. “With its lack of expertise, the company is unlikely to be successful.”

Rostelecom did not immediately respond to a request for comment on the project, which is to be named after the first artificial satellite, launched in October 1957.

The new search engine may need to be used by public institutions as the default tool, Vedomosti said, citing sources from Rostelecom and other internet companies in his report. He said the project had cost $ 20 million so far.

Kim said the plan appeared to have been forced on Rostelecom by the state and would most likely constitute a cash leak.

Russia, with the largest internet audience in Europe, has stepped up state control over the web, including launching a blacklist of sites delivering content such as child pornography, but which critics say could strengthen censorship.

Rostelecom is trying to hire developers from competitors to work on the search engine project, which is expected to launch in the first quarter of 2014, Vedomosti added. The project has so far indexed about half of the Russian Internet, he said.

Bank of America analyst Merrill Lynch said in a note that developing high-quality research technology may require top talent and time-consuming research and development, and the quality of research results may be much lower than that. of the main companies.

“Even if Sputnik’s launch is executed well, we don’t expect it to significantly eat away at Yandex or Google’s market share,” Merrill Lynch analysts wrote.

Reporting by Megan Davies and Maria Kiselyova, editing by Patrick Lannin

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