: The Red Web: The Struggle Between Russia

CHAPTER 3 Merlins Tower


Merlins Tower

The collapse of the August putsch freed Soviet citizens from Communist Party control. By December the Soviet Union dissolved. In the suddenness of the moment the old Soviet rules had become obsolete and new democratic rules were not yet established. At one point the KGB organized guided tours through its headquarters for foreign tourists, as if showing off a relic from another era. Foreigners flooded into Moscow and other big cities, private businesses emerged everywhere, and for a while new joint ventures were being established at every turn with foreign investors.

Yet it was also evident in these turbulent times that freedom brought something to Russia not very familiar to its citizens from all the years of Soviet paternalism: the freedom to make choices. Few were prepared, including those engaged in the most Westernized area of business, the rapidly evolving technology of computers, networks, and communications.

The Russian minister of communications, Vladimir Bulgak, who had brought the radio transmitter to the courtyard of the White House during the coup, confronted a monumental set of problems. He had taken over the Soviet ministry of communications, moving in to the same headquarters office used by Kudryavtsev at the Central Telegraph building. Bulgak soon faced the same cursed legacy of international communications that had vexed Kudryavtsev for so many years.[1] New Russian business enterprises were desperate for more communications lines and connectivity, and their demands far outstripped the existing analog infrastructure. The Soviet Union earlier and, now, Russia, simply did not have enough lines to the outside world. In 1991 Russia had only two thousand international lines for the whole country, and all of these lines were analog, copper cables.

Bulgaks first big headache was to acquire long-distance fiber-optic cable. Bulgak realized that his only option was to build fiber-optic lines with foreign money and foreign partners. He moved quickly and secured from President Yeltsin the right to sign off on government guarantees for foreign credits. Almost immediately Bulgak got Japan and Denmark involved. The partners built a fiber-optic cable from St. Petersburg to Vladivostok and from Moscow to Dzhubga near the Black Sea, and then the cables were laid to connection points of international telecommunications traffic: from St. Petersburg to Copenhagen, from Dzhubga under the Black Sea to Istanbul, and then to Palermo, Italy, and from Vladivostok through Nakhodka to Tokyo and Seoul. The whole project took three years and cost $520 million. Of the total, $500 million came from Japan and the rest from Denmark.

The demand was huge. We thought these lines will be loaded in fifteen years, and that happened in five years, Bulgak recalled.[2] Sometime later, when Bulgak met Nikolai Ryzhkov, who had served as prime minister under Gorbachev, Bulgak underscored how he had done what the Soviet Union had not. Look, you know, what did it cost me? $520 million. Thats for everything. And you were the prime minister of the entire Soviet Union, and what was $520 million to you? It was nothing! Why could you not do it? Ryzhkov did not have an answer.[3]

In three years, during a period of intense upheaval, Bulgak managed to increase the number of international lines in the country to sixty-six thousand, all of them digital.

An even more trying problem was to install modern telephone exchanges all over the country. Our industry then lagged behind the West by twenty to twenty-five years in producing the local phone exchanges, both international and intercity, said Bulgak. We came to think that our industry would never catch up, and that meant we had to go and buy. In three or four years over 70 percent of all Russian intercity phone exchanges were replaced by modern digital ones, made in the West.

By 1995 Russia had established modern, national communications.

Meanwhile, at the Kurchatov Institute, scientists faced their own obstacles. The phone bills for the open line to Finland were costing around 20,000 rubles a monthan ordinary Soviet-made car could be bought then for 45,000 rubles. Where could engineers and physicists go to find money to keep the connection open? These scientists were products of the Soviet Union, shaped by it, even though they recognized its failures and shortcomings. Private entrepreneurship had been outlawed in Soviet times, and the scientists had no concept of how to run a business. The two teams, one at Kurchatov Institute and the other at Demos, clashed constantly over the way to make the network profitable. Vadim and Polina Antonov, who were among the early participants at the Demos building, soon decided to move to Berkeley, California, leaving in December 1991, the month the Soviet flag came down over the Kremlin.[4]

Finally the two teams divorced. The group on the embankment, which had started the cooperative Demos, transformed it into an Internet service provider (ISP) of the same name. Demos had a special department in charge of selling personal computers, a very profitable business in the early 1990s, and the profits were used to fund the ISP.

The other team, headed by Alexey Soldatov at the institute, registered Relcom as a joint stock companya company owned by its shareholdersin July 1992. The Kurchatov Institute was listed among the founders, and Velikhov was made chairman of the board. Soldatov, who kept his position as chief of the Institutes Computation Center, was elected president, and Valery Bardin became his deputy and a development director. The idea was to launch the company to provide access to the Internet as a nationwide service.

But in 1992 no one knew much about launching a private enterprise.

There was one person, however, who seemed to know. Anatoly Levenchuk, a flamboyant engineer from Rostov, was a libertarian, obsessed with the idea of a free market. Levenchuk was a sparkplug of a manshort, energetic, driven by ideas. He favored extravagant outfits and spoke in a high-pitched, rapid-fire voice.

Levenchuk was the most agile and informed expert in the nascent Russian stock market. He got connected to the Internet early, in the winter of 19901991. Because of his indomitable energy, many enthusiasts went to him with business ideas, often involving establishing computer networks. To all of them Levenchuk put two questions. First, could he subscribe immediately? Second, did the network have access to the IBM network VNET? (At the time the Internet was still a collection of smaller networks, and VNET, which was based on IBM technology, was one of them.)[5] Usually the response was that the network was to be started in a few months, access to VNET was impossible, and then the enthusiasts disappeared. Finally someone referred Levenchuk to a contact who could say yes to both questions and gave him the home phone number of Valery Bardin of RelcomLevenchuk called that evening. Bardin said Relcom had access to VNET, but he didnt know how to sell to Levenchuk access to the network. It was a very basic business transaction, but the physicists simply did not have the know-how. Levenchuk subsequently helped write the contracts for Relcom to sell Internet access, and in the winter of 1991 he got an e-mail address provided by Relcom, one of the first 150 e-mail accounts in the country.

Levenchuk also showed up at the Relcom offices. Soldatov had wisely opened the office just outside the walls of the Kurchatov Institute, on the next street. Levenchuk told Soldatov how to write a development plan for the new company. The project attracted some investmentactually several tens of thousands of dollarsfrom Rinako, a large Russian investment firm, which, in return, got a share of ownership in Relcom, and Levenchuk was given a seat on the board of directors. Soldatov also asked Levenchuk to serve as a consultant. The first thing Levenchuk advised him to do was to look for serious Western investorsforeign investment could give the company a real chance to expand in the nascent Internet market.

But Soldatov was cautious. The unresolved question hung over them: Where to get money? Everyone sensed that the market for the Internet would be huge, but they werent sure how to go about it. In 1992 a third ISP, Sovam-Teleport, entered the scene, backed by the billionaire George Soros and the British telecom company Cable & Wireless. Almost immediately the new provider captured a third of the market. Meanwhile Demos was churning profits by selling personal computers. Soldatov faced a question he didnt know how to answer: How could he turn Relcom into an expanding business?

Bulgak solved the problem of connecting Russia with the outside world, but there was something else Internet users in Russia urgently needed. The horizontal structure of the Internet meant that the networks needed common points to exchange traffic. Also, the users needed more sustainable connections with the West, as most traffic in those days went back and forth to Western countries. Although Bulgak had established the sixty-six thousand digital lines, connecting to them from inside the country was still cumbersome and not always reliable. In 1995 Relcom, Demos, and the Moscow State Universitys network went to M9, the very first Moscow station that provided automatic international connections for the 1980 Olympics. The ISPs asked for help.

Mikhail Elistratov, the main engineer of the Moscow Internet exchange point, who has worked in the M9 building since 1995, explained, There is the ring of intercity phone cables around Moscow, and M9 sits on that ringalong with a few other hubs, like M10 or M5. Out of them there are rays of cables laid to the west, east and so on. These cables, then copper, were very thick underground cables and provided connection in the particular direction, so if you need Novosibirsk, which is on the East, you get to the M10, and if you need the West, you get to the M9. And the M9 could always be connected with M10 and so on. The fact that M9 was pointing toward the West and relatively new made it the logical choice to be the exchange point for the Internet in Russia.[6]

Relcom already had some modems at the station providing a direct connection to the Kurchatov Institute via copper cable, and the M9s main engineer, Vladimir Gromov, agreed to give the Internet networks space on the twelfth floor at the top of the building. It all started on the twelfth floor, even the first Moscow mobile operator got a space there because everyone wanted to be close to each other to get interconnected, Elistratov recalled.

The gathering on the twelfth floor became Russias first Internet exchange point, named MSK-IX. It was manned by a bunch of engineers who were given tables surrounded by telecommunications racks in a corner of the same floor. They were working for an organization, affiliated with Kurchatov, that was in charge of registering domain names in the .su and .ru zones of the Internet.

The MSK-IX was to become the main Internet exchange point in Russia for years to come.

Speed was everything for Bulgak. In the hurry to modernize, he bought equipment from abroad, bypassing old Soviet factories, which were forced to close. Bulgak didnt worry about their fate, but there was one organization that did concern him: the successor to the KGB, known in the early 1990s as the Ministry of Security. The ministry inherited the antiquated, analog systems of phone tapping from the Soviet KGB. The first time Bulgak went to the headquarterslocated at the Lubyanka, the old KGB buildinghe pressed them for answers about modernizing the telephone lines. I told them we are destroying analog lines and replacing them with digital lines. Understand? They said they understood, Bulgak recalled. Next he asked whether the ministry was ready to install digital interception equipment. The ministry responded by asking him to buy Western-made telephone stations that would have the intercept option built in, the kind available in the West for use by police departments. We bought the stations, and the security service took them, Bulgak said. What they did with them, I dont know. At a meeting with the minister of security Bulgak said he intended to keep modernization running at a fast pace. Are you keeping up with our pace? he asked. If not, tell me and I will slow down.

The minister replied, We will not slow you down. We can keep up with you.

The Ministry of Security got the job of phone and postal interception under a secret decree that was issued on June 22, 1992. Two days later Bulgak signed the paperwork giving the Ministry of Security access to communications cables and places where they could work to intercept calls.[7] When Bulgak went to Lubyanka again, he asked the same question: Are you keeping up with us? Is there any direction where we need to slow down? The answer was the same: No, we are keeping up.

In fact, the security services were lagging way behind.

In the aftermath of the Soviet collapse Yeltsin wanted to establish something like the Wests intelligence community rather than just a purged version of the old KGB, which had been responsible for everything from counterintelligence to foreign espionage to government communications to guarding borders. In 1991 the KGB was split into a handful of independent security agencies. The largest, initially called the Ministry of Security, then the Federal Service of Counter-Intelligence, or FSK, would be responsible for counterespionage and counterterrorism. In 1995 it was renamed into the Federal Security Service, or FSB. Then the KGBs former foreign intelligence directorate was transformed into a new espionage agency called the Foreign Intelligence Service, or SVR. The division of the KGB responsible for electronic eavesdropping and cryptography became the Committee of Government Communication, later called the Federal Agency for Government Communications and Information, or FAPSI. Directorates that had once been in charge of guarding secret underground facilities and protecting Soviet leaders as well as a branch responsible for borders were made into independent agencies.

The names changed, but as we wrote in The New Nobility in 2010, the shift from K to B at the end of the acronym of the FSB was more than symbolic. The renamed service was given a broad mandate to become the guardian of security for the new Russia.[8] The FSB regained its investigative directorate, which it had lost after the Soviet collapse, and would function both as a secret service and a law enforcement agency. On July 5, 1995, Yeltsin signed an act into law giving the FSB even more powers to conduct surveillance and interception. The only external control over the security services was the General Prosecutors Office, a special body responsible for overseeing all the secret services. But the prosecutors jurisdiction was limited.[9]

The multiple security services that arose out of the Soviet KGB were, at first, in a state of uncertainty. No one had given them a real sense of mission. The job of protecting the Soviet party-state, so central to the KGB, was obviously gone, leaving only a vacuum of ideology and a clear loss of focus. By 1995, however, the agencies began to regain their footing. They also began to struggle fiercely with each other, provoked by the fractured, competitive system Yeltsin created to keep the services under control. After obtaining a report from the FSB director, Yeltsin often compared it with reports from other security services. The process was a far cry from the concept of intelligence oversight in democracies and more like the competition of viziers in the medieval Middle East or Napoleons France, where several secret police agencies spied on each other.

As the 1996 elections approached, in which Yeltsin was running for another term against a Communist Party leader, Gennady Zyuganov, the security services competed with each other to keep Yeltsin in power, and their proposals were hardly democratic. The FSB and Alexander Korzhakovs service proposed that the election simply be canceled, which was not accepted. FAPSI, in turn, held a very strong card: the agency controlled the information system the Central Election Commission used to accumulate data from polling stations during national elections, built in 1995.

At Relcom Soldatov and Bardin were constantly arguing about the companys future, prompting Bardin to leave for a new, online project called the National News Service. It was to be a combination of a news agency and the first electronic archive of news media, launched by the daily newspaper Kommersant.

Soldatov had to figure out Relcoms future alone. Then, at a birthday party for Velikhov at the Kurchatov Institute on February 2, 1995, a new and unexpected overture appeared. The fifty-five-year-old director of FAPSI, Alexander Starovoitov, suggested in Velikhovs presence that Soldatov become his adviser, with the specific goal of creating a large new business network. Relcom would use FAPSI encryption equipment as well as hardware and software to protect information so to create a secure channel for business communications in the country. Soldatov immediately accepted the offer.

Yeltsin had signed a decree that declared illegal any encryption software or hardware device that did not bear FAPSIs seal of approval, therefore giving significant control of the market to FAPSI, which also offered its own encryption systems for sale. Such a two-faced approacha government agency leveraging its power for profitwas hardly unusual in the new Russia at a time when it seemed there were few rules about such behavior and even fewer rules that were enforced. But behind the offer to Soldatov were unseen motives: the agency wanted to create its own network and make big money by using Relcoms expertise.

Soldatov had been a member of the independent-minded group at Kurchatov that had created the first networks and had been somewhat disdainful of the old guard in the last days of the Soviet Union. But now a different government and a different system were rising. He wholeheartedly supported Yeltsin and believed that the new regime legitimately needed security services. As long as FAPSI served Yeltsin loyally, he did not see them as a threat. Moreover, the language used by the generals who ran the security services seemed to have changed with the timesthey were suddenly fluent in the vocabulary of contracts and business deals. Besides, Soldatov was confident he could outsmart the security services. He remembered a few years earlier, when they had demanded that he print out everything that came through Relcoms network, he simply said, Okay, but first, please give me a few hundred printers and huge barracks to keep the stuff. They went away and never returned.

In the first half of the 1990s Bulgaks Ministry of Communications seemed preoccupied with laying cables and replacing phone stations, not with the promise of the Internet. FAPSI was the only government agency interested in the Internet, and that also had a big influence on Soldatovs decision to do business with them. Relcom had found its backer: a government security service.

Anatoly Levenchuk, however, wasnt happy. I still think it was one of my biggest failures, he said. I failed to explain to them that money should not come from the state.

In April 1995 Sergei Parkhomenko, a thirty-one-year old reporter for the daily newspaper Segodnya, had a very hot story. He was a well-known political journalist who frequently appeared on television. In a biting column that appeared on April 8, he called the lower house of parliament, the State Duma, a circus of clowns, a crowd of buffoons, and parliament fired back on April 15 with a reprimand, making Parkhomenko even more popular among readers.[10] His career was on the rise. The owner of Segodnya was Vladimir Gusinsky, the media tycoon and one of the first Russian oligarchs. Shortly before this, Gusinsky had made an offer to underwrite a new weekly newsmagazine with Parkhomenko as the editor.

A tall, large man with thick dark hair and a beard, Parkhomenko could not be ignored for long anywhere; his loud voice and expressive manner always attracted attention. But he was hardly a muckraker. In April he found himself in a very tricky situation he was not accustomed to: the story he had reported was a startling expos? of the growing influence of the presidential security service led by Yeltsins sidekick, Korzhakov. The article pulled away the curtain on the ways in which the security service was interfering in political decisions at the highest levels and, when published, would probably cause a stir. Parkhomenko tried to get it printed in Segodnya, but the deputy editor, without explanation, delayed publication.

At the time, Yeltsin was enmeshed in the first Chechen war, and Korzhakov had threatened Gusinsky when his television station, NTV, broadcast vivid coverage of the war. After Korzhakovs men raided his offices the previous December, Gusinsky fled to London. With Gusinsky out of the country, the editorial office was now hesitant.

Korzhakov was a dark figure, a general with narrow views but vaulting ambitions. He had started his career as an officer in the KGBs Ninth Department, charged with protecting highly placed Soviet officials, and had been assigned to Yeltsin. He remained loyal to Yeltsin for years and kept guarding him, even after Yeltsin quit the Communist Party and Korzhakov was fired from the KGB. In the days of the August coup in 1991 Korzhakov was among those in Yeltsins entourage whose phones were tapped by Kalgins KGB department. In turn, Yeltsin rewarded Korzhakov by naming him chief of the presidential security service. Korzhakov was certain that KGB methods could be applied to everything, from the economy to politics. He wanted to turn his agency into a powerful structure on its own, one that could sway politics, control government ministers, and pressure the new Russian oligarchs. From his Kremlin office Korzhakov had his subordinates interfere in business disputes and had the power to conduct all kinds of surveillance.

Parkhomenko had spent months researching his story, and he didnt want it to die. Frustrated by the silence at Segodnya, he went to the newspaper Izvestia, a popular democratic daily. I offered them the story, and they agreed to publish it, Parkhomenko recalled. They even made the layout of a double-page spread. But Parkhomenko soon realized that Izvestia was also holding it up. At home he stashed away two page proofs of his storyone from Segodnya and one from Izvestiabut he still had nothing in print.

The story was so sensitive and the climate so uncertain that Parkhomenko thought it was time to hide some of his research so the security services could not seize it if they attempted to target him. He was also contributing to Agence France-Press, so one day he went to the Moscow office of AFP with all the documentation and his records. There was a tiny room occupied by the bookkeeping office, and contributors files were stored there. Parkhomenko said he needed to examine his files and then hid all his records there for safekeeping. I thought it very unlikely for someone to look for the documentation about the Presidential Security Service in the bookkeeping office of the AFP, Parkhomenko sighed.[11]

In late April 1995 Parkhomenko, increasingly frustrated, decided to approach the newspaper Moskovskie Novosti. It was located on Pushkin Square in the center of Moscow, with the newspapers title proudly emblazoned on the roof. The Russian-language weekly was launched as part of the propaganda effort around the Moscow Olympics in 1980, but during Gorbachevs perestroika period, under editor Yegor Yakovlev, the weekly became an independent and vocal alternative to the official Soviet press. In the late 1980s Muscovites crowded every Wednesday around the stands by the entrance to the offices of Moskovskie Novosti, where pages of the weekly were displayed to read and discuss the latest edition. In the mid-1990s its predominance faded, but the paper remained a respected voice, with strong democratic traditions.

Parkhomenko went directly to the second floor, to the office of the editor Viktor Loshak, and brought his story with him.[12] Loshak read the story and at once summoned his deputies.[13] They, in turn, read the story, and the paper didnt hesitate: Parkhomenkos story was made up in pages, now of Moskovskie Novosti design, and this time it was published. But because it was huge, the investigation came out as a two-part series, called Merlins Tower.[14]

Parkhomenkos investigation exposedin a way the public had never seen beforethe fearsome atmosphere in the offices where power was held in Russia, including the White House, the Kremlin, and Staraya Ploshad, where the presidential administration was headquartered. In his story Parkhomenko described how presidential advisers conducted sensitive conversations by exchanging notes on scraps of paper, which they quickly burned, fearful that their offices were bugged by the Presidential Security Service. Parkhomenko described how he was forced to keep walking briskly with his highly placed contacts when in these corridors of power because the officials were certain the Korzhakov service could not switch the microphones so quickly. Only a few years since the death of the KGB and the Soviet police state, paranoia was rampant among high-placed bureaucrats. When one official showed me to his office he took two pencils and put them in a keyhole of a big safe in the corner. He appeared to be certain there was a video camera inside, Parkhomenko wrote.

The publication of Merlins Tower marked an important turning point, revealing the extent to which Yeltsin had begun to rely on people and organizations of the security services. Memories of the Soviet Union were still fresh, and the idea that surveillance and eavesdropping was again being deployed in the new, more democratic environment was deeply unsettling.

Korzhakov met the articles with silence, Parkhomenko went back to the bookkeeping offices of AFP and retrieved his research files, and after his reelection triumph in 1996, Yeltsin fired Korzhakov. Although this removed one figure from the palace intrigues, the jockeying for power never ceased. Yeltsin, struggling with health issues and alcoholism, was still surrounded by family, staff, oligarchs, and politicians who pulled him in every direction. Nonetheless, Yeltsins 1996 reelection victory seemed to bar a return to the totalitarian Soviet past. A period of optimism prevailed.

These were the months when we first walked through the doors of the newspaper Segodnya as reporters. Andrei was twenty years old, Irina twenty-one. We thought it was the best thing that ever happened in our lives. We knew that Gusinsky, the powerful media magnate, owned Segodnya and modeled it after the New York Times, bringing in very influential political journalists, including Parkhomenko, Mikhail Leontiev, Tatyana Malkina, and Olga Romanova. Romanova, in her late twenties then, amazed everybody with her speed and precision; she rushed in the room, had all stories for the economics page edited in two hours, wrote her own story, made a dozen calls, and then rushed out to meetings.

The newspaper had the best culture department in town. The offices on Leningradsky Highway occupied part of the building of the Moscow Aviation Institute. We saw it as a gateway to the new, modern, and Westernized world. The walls were painted white, and the tables were black with sleek Macintosh computers on them, a striking contrast to Soviet-style offices of other Moscow newspapers, which had faded, wood-paneled walls, slamming metal doors, and pneumatic tubes for delivering typewritten articles. Irina joined the paper three months before Andrei, and by the time Andrei arrived, she had already written critically about municipal policy under Moscows powerful mayor, Yuri Luzhkov.

Many of the journalists were young like us. The head of Andreis department was Andrei Grigoriev, who, at twenty-six years old, was considered an experienced journalist. He exposed the vulnerability of prominent banks and was sent for a few months to Europe because the editors thought his life was in danger. Both of us felt the excitementand a sense that we almost missed the last trainabout reading courageous dispatches from the Chechen war by Masha Eismont, who was then twenty-one years old.

Rossiyskaya Gazeta, a newspaper owned by the government, had also approached Andrei. He decided to talk to them. A stiff and officious deputy editor, a woman in her fifties, told him about what kind of future he could expect at there, that after three years he could expect to be given a special press card with the words Administration of the President on it, which, she said, would make him very proud. She didnt mention the topic he would be reporting on, saying he would be attached to the city news section. It was such a striking contrast to Segodnya, where Andrei immediately was given a topic for reportinginformation technologyand told he was to cover it alone. Andrei felt excited: it basically meant he could define the policy of such an influential daily newspaper on this burgeoning subject. (Though his father was not particularly thrilled and told him to leave his field after reading a critical article Andrei wrote on FAPSI. After that they didnt talk to each other for a few months.)

Being a journalist in the mid-nineties not only offered the thrill of the work but also changed ones social status. In a few months our monthly salaries reached $600, way higher than Irinas parents at that time. Young and with no family obligations, journalists filled just-opened bars in Moscow, drinking and talking only about their profession. One day someone brought the Reuters guidelines for journalism to Jack Rabbit Slims pubconveniently located next door to the offices of a competing daily Kommersantand provoked all-night talk about Western versus Russian rules of journalism.

In six months Andrei wrote his first lengthy feature. The story was about how Oracle databases were acquired at Lubyanka, the FSB headquarters. Andreis contacts told him that Oracle technologies, which were subject to export restrictions in the United States (Oracles CEO, Larry Ellison, once famously said that the Russians would take Oracle only in missile warheads), were sold to the FSB to build a huge database on terrorists. An outraged FSB officer called the newspaper before the publication, trying to kill the story. But nobody paid attention to his threats, and the story made the front page.

One day Irina went to the editor-in-chief and asked to be transferred to the crime department of the paper. The astonished editor tried to talk her out of it: the crime department was not the most prestigious unit in the newspaper. He suggested instead that she move to the political department, but Irina persisted; she thought it was the best place to get journalistic experience. Indeed it was.

On the fifth floor of the offices of Segodnya there was a large room with a radio scanner on the windowsill, always turned on to listen to a police frequency. A dozen people hung around day and night, among them a former KGB officer, an ex-policeman, and a pair of sixteen-year-olds. One of them was brought to the newspaper by his father, a policeman, who was troubled by his sons criminal mindset. The boy turned out to have a talent for crime reporting. Parkhomenkos son also landed briefly in the room. Some of the reporters often signed their stories by pseudonyms, and several people shared some of the pseudonyms to make the identification more difficult: the department received calls from angry policemen and businessmen with clear criminal connections almost on a daily basis.

In the 1990s these reporters not only wrote about crime but also did the work of the investigative departments: they covered the high-profile assassinations of businessmen and politicians, wrote about secret services, and were sent to the North Caucasus to cover hostage dramas. Within a year Andrei followed Irina to the crime department, where the reporters had developed a camaraderie and helped each other in sometimes very tough circumstances.

In these years journalists had power, and we felt it in our work. But journalism also suffered from a lack of restraint and established ethical standards. The nascent public relations industry often attempted to bribe journalists, promising money for publishing false or sometimes genuinely compromising information about high-placed officials and prominent businessmen. A mix of intercepted phone calls and analytical profiles prepared by the oligarchs shadowy security branches or the government security services became known as kompromat, or compromising materials. What made it all even more confusing was that sometimes journalists willingly acted as mercenaries for various interests or loyal members of the oligarchic business structures. Russian security services carried out surveillance and intercepted phone calls, selling their findings as part of kompromat. The resulting articles effectively influenced the public.

The editorial offices battled frantically with this corrupt journalism. Kommersant installed a special department called rewrite (in English), tasked to edit heavilythat is, rewriteevery piece submitted by staff journalists for publication to filter out any zakaz, or information that had been paid for by a special interest. Segodnya had a former officer of the Fifth Directorate of the KGB who in Soviet times was in charge of persecuting dissidents; now he checked suspicious articles after publication. If he concluded a story was unfair, the journalist was fired.[15]

In the mid-1990s the flow of information in media was free but could also be confusing for readers. The oligarchs used their news media outlets as weapons to fight for control of the nations vast resources. Around the same time, by 1996, the Russian Internet was undergoing explosive growth. The first search engine, Rambler.ru, appeared, and the first political party website was established for Yabloko, and Interfax news agency launched its own website. Internet advertising became a paying business, drawing real revenue. It was a new, fashionable business that caught the Russian oligarchs attention. Boris Berezovsky, one of those who helped secure Yeltsins victory in the presidential elections, underwrote a new Internet service provider, Cityline, whose managers were the first to grasp that people came to the Internet because of the actual content they could find there. Cityline helped launch a handful of online media and content projects, ranging from magazines to blogs.

In December a thirty-year-old Internet activist, Anton Nossik, started a new project, a daily online column called Vecherny Internet, or the Evening Internet, which was hosted on Cityline. The project was launched from Israel, as Nossik, born to a prominent Moscow intelligentsia family, had emigrated to Israel in 1990 and became prominent in the Russian and Israeli Internet communities.

Nossik soon realized that the new Internet media could trump the traditional journalism. He believed people would embrace information presented on the Internet, as it would be available sooner, more accessible, and brief. Less concerned about gathering the information, his sought to emphasize the form, not the substance. He wanted to repackage news from traditional print media and deliver it to Internet users quickly. It was an early kernel of what became the news aggregator, and it would define the Russian Internet for the next decade. Riding the wave of the Evening Internets success, Nossik returned to Moscow in March 1997.

The Evening Internet became the very first blog in Russia.

In the vast apparatus of the Russian government one group of officials began to pay close attention to this new online activity. The security services were among the first to conclude that it should be controlled.

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