In Russia, DST’s And Yandex Ramp Up Mobile Presence

Following on from its acquisition of mobile software developer SPB at the end of November, Yandex is making one more move to increase its ubiquity among the growing number of smartphone users in the country: the search giant is reportedly planning to launch search apps for Apple’s iOS devices by the end of this year.

The news comes at the same time that another big Russian internet property, Digital Sky Technology’s free mail provider, is also releasing a product it hopes will increase its use among mobile consumers in the country: it has partnered with Nokia (NYSE: NOK) to develop a new web browser for Nokia’s S40 feature phones, which remain some of the most popular in the country.

The Yandex deal will see the company launch an iPhone app by the end of this year, with an app optimised or for the iPad tablet in 2012. The news was first reported by the Russian financial newspaper Vedomosti, which cited company spokesperson Ochir Mandzhikov for the launch dates.

Yandex has some 10 apps already published for Apple (NSDQ: AAPL) devices — covering maps, navigation and mail — but this will be the first one dedicated to search, the company’s bread and butter from a revenue perspective, where (like Google (NSDQ: GOOG), China’s Baidu (NSDQ: BIDU) and other search portals) it runs advertising alongside search results. The app will also give users quick access to other Yandex services such as weather and exchange rates.

Meanwhile, is launching a new web browser for S40 feature phones, which remain some of the most popular in Russia today. In collaboration with Nokia, is integrating a number of its services, such as e-mail, news and social networking, into a browser that it says is specially optimized for smaller screens and lower bandwidth use (some of these devices, for example, will not even necessarily have 3G capabilities, or processors to handle heavy data files from the Internet).

What’s interesting about the S40 deal is that these were all the kinds of services that Nokia in the past had tried to develop itself, but is now conceding to other companies that are either stronger players in these areas technologically, that already have strong local presences ( is the biggest of the free mail providers in Russia today) — or ideally both.

Nokia’s Russia director, Alexander Kopanev, notes that the deal with is a first for Nokia in Russia — and it will be interesting to see if Nokia tries to replicate the relationship with other local search giants in other markets, or whether it tries to work with other properties in the DST umbrella (the company is also a shareholder of Facebook, among other holdings).

For Yandex, the move into iOS search apps represents a significant step forward on the platform, where it has so far not gotten very far with discussions with Apple to preload the service on to devices sold in Russia. It has inked some other key deals to preload its services: with Samsung for its connected TVs and bada phones, as well as with Microsoft (NSDQ: MSFT) for its Windows phones distributed in the market. It also had an existing agreement with Nokia for its Symbian handsets.

The Vedomosti article notes that while Yandex is still the biggest search engine in Russia, the rise of Android devices and other smartphones have put something of a dent in its market share. That’s because the Android devices default to Google’s search services, while on iOS devices Google is the default search on Safari, Apple’s own default web browser.

Google’s Android currently accounts for 27 percent of all mobile devices sold in Russia — a three-fold rise over the last year — while Apple’s share is now five percent (from one percent a year ago). Yandex’s share of the search market is 60.8 percent, a decline of 3.6 percentage points. Google’s has gone up by almost the same amount, 3.5 percent, to a total of 25.4 percent of the market., on the other hand, appears to be making more of a play not for the platforms that may dominate more in the future, but for the ones that are strongest today. Nokia currently sells some 27 models of devices built on its S40 platform, which makes it the most popular platform for what is still the biggest mobile device vendor in the Russia.

The new browser is available for download by existing users, and will presumably be bundled into new devices that will be sold in the future.