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Russia's economy already lost $860 million this year because the government keeps shutting down the internet

Mar 19, 2022, 16:19 IST
Business Insider
Xander Heinl/Getty Images; TikTok; Rachel Mendelson/Insider
  • Russia has lost $861 million this year censoring its internet, according to watchdog group NetBlocks.
  • The government has blocked access to social media outlets like Facebook and Twitter.
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Censorship is expensive — and it's already cost Russia hundreds of millions of dollars this year.

A new report from independent research firm Top10VPN.com showed that it's been costly for governments around the world to shut down the internet and block individual social media outlets. So far, Russia leads the pack in terms of costs, losing nearly $861 million since January through deliberate outages. It's more than double the losses incurred by the second biggest censor, Kazakhstan, which has spent $429.5M this year.

That figure comes from both the direct and indirect impacts of such restrictions on a country's economy, NetBlocks, the watchdog group that calculates the damages, told Insider. The "cost" represents how much a country's population could lose from internet blackouts and social media restrictions, including lost work productivity, investment potential, and opportunity costs, both directly to the digital sector and to digital-dependent sectors.

That's a big price tag for a country that's hemorrhaging money. Many western countries were quick to enact costly sanctions against the Russian government on the heels of its invasion of Ukraine. The sanctions are already devastating the country economically, the ruble is tanking, and economists estimate that the country will hit a recession by this summer. The increasing Kremlin censorship will likely drive citizens to the dark web, or cut them off from reliable information altogether.

"This kind of deliberate disruption is internet censorship in its most extreme form," the researchers wrote. "Not only do these internet outages infringe on citizens' digital rights but they are also acts of economic self-harm."

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Even with its unparalleled investment in creating an "iron curtain" around its internet meant to cut citizens off from international or independent news, the Russian web was still relatively free in comparison to that of online strongarms like Iran and China. Even last month, the Washington Post reported, Russia's Internet was fully "integrated into the larger online world," and citizens had outlets to organize and seek out alternative sources of news while Putin controlled the country's free newspapers and broadcast stations.

Since its invasion of Ukraine, however, Russia has blocked access to Instagram, Facebook, and Twitter for its residents. The government also prohibited access to Voice of America, the BBC, Bloomberg, CNN, and Deutsche Welle, as well as major Ukrainian outlets.

"In effect, the country has been sanctioning itself with these restrictions," the firm said on Twitter.

The price of keeping citizens in the dark

Russia's near-billion dollar campaign to confiscate a free internet from its citizens is a massive leap from where the country was at the end of just last year, when it lost less than $1 million shutting down the internet. Russia is already a third of the way to beating Myamar's total for all of 2021, which dominated the list last year with $2.8 billion in missing cash.

Russians are trying to find their way around the blockade, with demand for virtual private network (VPN) services skyrocketing in the country, as well as in Ukraine, since the start of the war. VPNs protect your identity and browsing activity from governments, hackers, and anyone else who might be looking into your internet use. The five most popular VPNs in Apple and Google's app stores were downloaded 2.7 million times in Russia in the first week of the Ukraine War, a 200% increase from the week before, and the encrypted messaging app Signal was downloaded more than 130,000 times in Russia last week, according to CNN.

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And Russians are increasingly turning to the dark web, a hidden collective of internet websites. Barred social media outlets are starting to embrace the shift, with Twitter launching a dark web-accessible version to bypass the Russia block last week.

And that's a move that might be vital to keeping ordinary Russians informed, experts say, as the Kremlin actively invests in censorship and disinformation.

Tech companies voluntarily leaving Russia — or platforms vastly restricting their services — could hurt regular Russians, as well as Ukrainians who are in occupied territories who can only access the Russian internet, Natalia Krapiva, the tech-legal counsel at the non-profit Access Now, which works to protect digital access globally, told Insider's Connor Perrett this week.

"While obviously there's legitimate concerns and the need to impose sanctions on Russia, some of the actions are now basically isolating and disconnecting people who are in fact opposing the war," Krapiva said.

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