ChatMonopoly: Russia consolidates control over social media

Update: On Thursday, Russian President Vladimir Putin made new threats to Russia’s largest search engine Yandex, for locating its servers abroad, and called the internet an invention of the U.S. Central Intelligence Agency (CIA). 

Russia’s largest homegrown social network, Vkontakte, with its more than 100 million users, is now under new management. Founder and CEO Pavel Durov is “out for good” after resigning from the company often described as Russia’s Facebook. He will be replaced by Kremlin sympathizers Alisher Usmanov and Igor Sechin.

Durov blames Russia’s restrictive government for his departure from the company, and has left the country with no plans to return. A month ago, TechCrunch reported that Durov had faced pressure to take down pages related to President Vladimir Putin’s opponents, and to “give out private data for Ukraine’s opposition leaders.”

Access sees this development as another blow against freedom of expression and privacy in the country that is increasingly cracking down on dissident voices online. It follows a plan to require foreign social networks to store user data on Russian soil, and occurs in the context of Russia’s domestic and regional mass surveillance system.

Two friends of the Kremlin, Alisher Usmanov and Igor Sechin, were selected to replace Durov at Vkontakte. This is the end of a gradual takeover of VKontakte, as Durov sold his 12 percent stake to an Usmanov crony earlier this year.

Access has tracked Usmanov’s takeover of digital communications in the country with dismay. Usmanov is the majority owner of MegaFon, Russia’s second largest mobile telecom provider, and also owns, host of the second and third biggest social networks in the country. With this move, Usmanov has now successfully consolidated a monopoly over Russian social networks.

Usmanov owns traditional media as well, including the publishing house and newspaper Kommersant.

Despite its size, Usmanov’s mobile operator MegaFon does not have a good track record when it comes to protecting user rights. When MegaFon went public on London’s stock exchange in 2012, Access noted the company’s multiple failures to protect user privacy and strengthen its corporate governance. We wrote, “MegaFon’s lack of transparency continues to raise serious questions about its relationship with the Russian state that is increasingly silencing dissent and jailing opposition voices.” Indeed, even Goldman Sachs pulled out of the MegaFon IPO over concerns about the company’s management.

Durov is not the first tech entrepreneur to leave the country. In 2010, ChatRoulette’s teenage founder Andrey Ternovskiy left for Silicon Valley with much fanfare. The disruptive nature of internet businesses, and the freedom of expression and access to information that online services enable, have not been well received in the country’s oligarchical economy and governance. Replacing Durov with Usmanov is a worrisome development, placing a darker shadow over the future of the open internet in Russia.

Access recommends that all users carefully consider what material they share online. Given these developments, users of Russian platforms in particular must take care to avoid risks to their privacy, and protect sensitive data. Access will continue to monitor the developments in Russia and seek ways to defend users rights there.

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