Last week rumours of a potential Mail.ru/Google deal hit Runet. Although Google previously held a deal to provide organic and contexual advertising to the engine for 2003-2005. They lost this contract to Yandex at the end of 2005. Mail.ru confirmed the deal this morning.
Mail.ru is a rising star in Runet. It has built marketshare to 10% and replaced Rambler as the third largest search engine in Runet. Google currently holds 30% against market leader Yandex with 53% (63% incl. Mail.ru results). This move effectively takes Google to 40% market share.
However this is probably only a temporary win for Google. The issue at the heart of the Yandex/Mail.ru split is the refusal from Mail.ru to brand their results as being powered by Yandex. The Russian search giant was reported to be unhappy with Mail.ru promoting their search technology as their own. Subsequently Google has won back the deal by agreeing to provide the engine with unbranded results.
Why is this important to Mail.ru? Well, Mail.ru have their own search aspirations. They have already developed a mobile search application and invested in their own search platform, GoGo.ru. So far the technology has not been a success, barely registering on market-share charts but they clearly want to head in this direction. As their press release states,
…Mail.Ru plans to actively develop its own search technology. The search “engine” will be used without mentioning the Google brand. Mail.Ru will be able to handle the requests of users using its own technology, in order to test and further improve their development, and as a consequence – the [search] product as a whole.
So count down the days until Mail.ru decides to dump both the search giants and go it alone. When 98% of Google’s revenue comes by the way of advertising, it makes sense to develop your own technology to capture that income stream.