Google, sans a big Android stand but with the largest global smartphone share for its mobile platform, may not be making as much news as in year’s past at the Mobile World Congress in Barcelona, but Yandex, the search and cloud/mobile apps company often called the “Google of Russia,” is. Today the company released Yandex.Store, an alternative, customizable, native app store for Android devices launching with 50,000 apps, along with an updated version of Yandex.Shell, a 3D UI, also for Android devices.
Taken together, the two are a signal of how Yandex is courting handset makers and app makers with its own Yandex apps as a route to growing its presence on mobile devices. And, in the words of one industry source familiar with the deal, it is “pinching” Google on low end devices especially in the process. Those low-end devices, it is estimated by some, account for up to 30% of all Android-phone shipments in some markets.
“The global market for Android-based mobile phones is very fragmented,” Alexander Zverev, head of Yandex.Store, noted in a statement. “There are only a few major players who enjoy a meaningful share, with the remaining portion of the market, which is quite significant, distributed among hundreds of smaller companies. We are joining the game to contribute to competition [and] ensures freedom of choice.”
But don’t take this as a sign (yet) that Yandex will be making its own equivalent of a Nexus anytime soon. Rather, it wants to use the open source nature of the Android platform to try out and grow its mobile business. “Yandex doesn’t have such a plan,” the source said of making a handset. “It is totally another business from all points of view, and Yandex thinks it can reach its targets other ways, like deep Yandex service integration on Android.”
The first hardware partners for Yandex.Store, which we initially covered in October 2012 when it opened up to developers to submit apps, are 3Q, Explay, Oppo, PocketBook, Qumo, teXet, Wexler — seven smaller hardware makers who make Android devices for the Russian market, among others. They will variously be installing Yandex.Store as the default app store on new devices, or as a pre-installed app store to sit alongside others. MegaFon is one Russian carrier that has already implemented Yandex.Store to power its GetUpps! app store.
The idea behind offering an app store as an alternative to Google Play is this: for those handset makers that target Russian-speaking consumers, users in Turkey (another market where Yandex has been investing in local services), or really anywhere, they can use Yandex.Store to provide a more localized experience. (Languages at launch are English, Spanish, French, German, Italian, Turkish, Ukrainian and Russian, and more are getting added.)
They can also pair the store with other apps like Yandex Mail and Yandex Maps — popular applications that often get used in Russia instead of Google’s services anyway. Yandex has made more than 20 Android-based apps covering additional services like cloud services, traffic and even taxi ordering. The store itself will feature the usual range apps from business to consumer titles, with the latter including Twitter, Foursquare and Cut the Rope, as well as apps for Russian social networks VK and Odnoklassniki and IM service ICQ.
Like Google, for Yandex, the point of building all these free services is that it directs traffic to services like ads where the company actually makes money.
There are other reasons, too. Yandex will be selling paid apps in the store, and so it will be taking a cut of those sales — following the 30/70 revenue split (developers getting 70%) that has become standard in the industry. It is also promising a degree of security at a time when we have seen a lot of Android-based malware: each app is scanned by Kaspersky Lab for malware before it’s uploaded to the store.
But in a more defensive move, Yandex still makes the bulk of its money today on desktop, but its market share growth has declined, even as volume of searches has increased. That means it needs to look at new platforms for longer-term growth.
Yandex.Store can be implemented on a stock Android device — meaning one that runs one of the straight versions of Android’s OS — but also one that has taken and customized the platform. There are further partners getting announced in coming weeks, a spokesperson tells TechCrunch.
Yandex.Store, as we reported before, is developed with Opera Mobile. Opera is supplying the bulk of the apps that will be sold there, but this is not exclusive. Yandex is “interested in other partners with app lineups to [also] be aggregated into Yandex.Store,” the spokesperson added.
The white-label part works in another way, too — Yandex will be offering handset makers and carriers the ability to skin the store with their own branding, and customize apps within it. Sometimes that service will even be 
offered free, depending on the level of customization requested.
Yandex.Shell
Yandex says that since launching in February 2012, Yandex.Shell — the company’s UI skin that offers a “3D”
graphical interface for browsing apps on your Android smartphone — has been downloaded over one million times.
As with the Store, Yandex.Shell is downloadable by consumers, but it is primarily a product aimed at improving Yandex’s business with carriers and handset makers, who can use it to further customize the phone’s stock
software to create more customized experiences.
The new version getting released today will enhance the 3D effect on the dialler and address book.