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Russia: Local Authorities Slow Broadband Development

Kraskovo township coat of arms (from the offical site)

Town of Kraskovo coat of arms (from the official site)

Russian activists gathered in Kraskovo, a small town near Moscow, to call for increasing broadband Internet access and protest against Internet provider monopoly.  The activists also talked about superficial regulations that slow down the development of wide Internet access in the country.

The story goes back to the beginning of 2008 when an Internet service provider (ISP) “CDMS, Ltd” ( “Creative Direct Marketing Solutions”) announced its plans to offer broadband Internet access to the residents of Kraskovo.  Russian laws require an ISP to obtain a permission from municipal authorities before offering its services in any town. An ISP also has to get an approval of the Federal Security Service (FSB) and install a hardware that would potentially allow to sniff the Internet traffic.

With 10 years of experience in business, the CDMS got used to all sorts of bureaucratic hurdles. The vice-president of the company Vladimir Korvatsky (lj-user korvatsky [RUS]) writes on his blog that minor problems with local authorities are nothing new but Kraskovo case is different.

According to a Russian newspaper Moskovski Komsomolets [RUS], when the CDMS applied for a permission to install Ethernet-network in Kraskovo, Mikhail Chuiko, a newly elected mayor, sent the application back with a note that the process should be coordinated with the FSB “to ensure protection against terrorists.” When the FSB finally authorized the application, the mayor requested another approval from the security service. This time he wanted the FSB to investigate the company.

This shouldn't surprise anyone in Russia. Government officials usually come up with many excuses to delay the approval process so they can make businesses pay a bribe to speed it up. But, unlike in many similar cases, the Kraskovo authorities did not want any bribes from the CDMS. They stopped all contacts with the company representatives and showed that they did not want the CDMS to enter local ISP market.

Kraskovo currently has two ISPs offering a broadband access: netts.ru and avk-wellcom.ru. Korvatsky states [RUS] that his and other companies are not allowed into the town because of strong ties and commercial interests uniting local ISPs and the town authorities.

Vladimir Korvatsky and the youth organization “Our Yard” organized a protest against the status quo with ISPs in the town:

The Moscow Region Anti-monopoly Service recently issued a statement [RUS] declaring that the Kraskovo authorities violate anti-monopoly law.

This case is far from being unique. There are thousands of small Russian towns where people don't have a luxury of the broadband services. Very often geographical isolation and the lack of initiative are just excuses for widespread corruption of local administrations in those towns. The example of Kraskovo shows how ISPs try to overcome those issues by taking public actions. At the same time,  it gives an additional reason for local authorities to accuse the ISPs of astroturfing.

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