Reaching the summit unearthed a expansive crest for us, according to the leader of Yandex's Fantech and their site.
Interview with Artem Savinsky, New Head of Yandex's Entertainment Division
When the opportunity to head Fantech presented itself, what went through your mind? Did you accept immediately?
Holding the CEO position at Yandex has been an incredible journey, but taking on the dual role of heading Fantech sparked a renewed sense of excitement. To dive deeper into the world of entertainment, I needed some time to reflect on the responsibilities that come with leading a multi-brand tech business with nearly 1,500 employees.
I have always been proud of my roots within the company, having grown from an entry-level employee to CEO over the course of eight years. My growth from within, as well as my familiarity with the company's products, made the transition feel more natural. However, leading a mainstream entertainment business was new territory for me, and I needed to carefully consider the move.
After a month of thought, I began preparing to pass on the daily management of our entertainment subscriptions and investments. In collaboration with the Yandex team, we worked tirelessly for half a year to make the transition smooth.
Accelerated Investments in the Creative Industry
Last year, Yandex announced a $100 billion investment in developing the creative industry by 2024-2025. This includes buying rights, content production, and events. What motivated this increase in investment, and what are your objectives for these funds?
Our ambition is to drive growth in our entertainment business beyond the market's pace. We have seen remarkable success over the past year, with our revenue exceeding $98 billion, and growing by a striking 47%. With this growth, we have already invested over half of the promised $100 billion.
This investment has been allocated across various areas, including licensing, books, films, series, sports, and original productions. We have also ventured into non-content scenarios, such as providing 50% cashback on cinema tickets, to expand our reach and value proposition for our subscribers.
In addition to content investments, we have integrated Yandex Plus with the company's city services and fintech, making the subscription more tangible. This integration includes increased cashbacks, higher savings interest rates, and better installment conditions (Split) for Plus users. However, spearheading these changes required significant resources.
Innovation in Yandex Go and the Integration of Afisha
One of the advanced projects combining entertainment and technology is the integration of Afisha into Yandex Go. Can you explain how this has transformed the user experience?
This collaboration presents a seamless, personalized entertainment experience. By utilising cutting-edge technology, users receive reminders a few hours before their show, prompting them to consider their transportation options, and offering convenient choices within Yandex Go. The magic of this system lies in its smooth and effortless integration, ensuring that a user never feels overwhelmed or confused.
To provide a clear idea of investments, consider the following: We have three primary services within Plus - Yandex Books, Yandex Music, and Kinopoisk, which cover video, reading, and audiobook streaming, alongside music streaming, and an emerging focus on sports. We are also investing in near-content products, such as games, under the Plus Studio umbrella.
We recently acquired the Comic Con and Igromir brands, signifying our entrance into the competitive pop culture and gaming festival market. Comic Con Igromir 2025 is set to take place at Timiryazev Center from December 12-14, with the hope of presenting some of our gaming innovations.
Growing Gaming Potential
What are your hopes for the gaming direction?
We are witnessing substantial growth opportunities, and with our profitable business model, we can afford to explore new avenues. We aren't just enhancing existing scenarios; rather, we are expanding them to explore the diverse world of entertainment.
When can we expect these investments to yield returns?
The returns are almost inevitable, due to the small fraction they represent in our overall revenue. Our subscription ecosystem, powered by each of the services offered, has grown faster than the market. However, it's crucial to keep in mind that the streaming and subscription market is expected to grow by about 25%, reaching approximately $210-$215 billion by 2025.
Transparency and Ambition
Given your prominent role in the industry, do you feel that you serve as a beacon, attracting investors?
The success stories from our ventures, such as the billion-dollar hit "Nothing to Fear, I'm With You" and the growing popularity of musical series, have attracted the attention of other investors in the industry. Our transparent metrics and financial stability have enabled them to make informed decisions to join us on this exciting journey.
Staying Relevant in a Rapidly Evolving Landscape
Given the competitive and ever-changing nature of the entertainment industry, what strategies will you employ to maintain Yandex's position at the forefront?
Firstly, we must not become complacent, but instead, continue cultivating our relationship with our subscribers, ensuring continued trust and growth. As a leader, my role is to maintain the core subscription business, uphold high product quality, and maintain the profitability of the business, as these aspects form the foundation for sustainable expansion.
Secondly, I am committed to strengthening partnerships, which is at the core of our value proposition. These relationships enable us to grow and adapt to the demands of the creative economy.
Thirdly, I will closely monitor technological advancements, such as generative neural networks and large language models, ensuring that we integrate these innovative technologies into our products and services.
In essence, our strategy can be summarised into three key fundamentals: sustain, grow, and evolve. I am confident that by staying committed to these principles, we can continue contributing positively to the entertainment industry and the broader creative economy.
- As the new head of Yandex's Entertainment Division, I felt a renewed sense of excitement to delve deeper into the world of entertainment and lead a multi-brand tech business with nearly 1,500 employees.
- Our ambition is to drive growth in Yandex's entertainment business beyond the market's pace, and we have already invested over half of the promised $100 billion in developing the creative industry by 2024-2025.
- The integration of Afisha into Yandex Go offers a seamless, personalized entertainment experience, providing users with convenient transportation choices for their shows.
- The returns on our investments in the gaming direction are almost inevitable, given the small fraction they represent in our overall revenue and the expected growth of the streaming and subscription market by about 25% by 2025.
- To maintain Yandex's position at the forefront of the continuously evolving entertainment industry, we must stay committed to sustaining the core subscription business, nurturing our relationship with subscribers, strengthening partnerships, and closely monitoring technological advancements.
