The kremlin Is Building a Digital Prison with the Help of a Bankrupt Monopolist

The russian telecom giant “rostelecom” has become the kremlin’s digital eye, spending colossal resources on surveillance of russians. As of the first half of 2026, the company’s net debt had reached an astronomical 731.56 billion rubles. Despite its massive debt, the operator continues to buy up equipment and ramp up spending to ensure the government’s complete control over society – all at the cost of millions in losses and new loans.

Immediate plans include gaining direct access to routers and modems in russian homes. “rostelecom” has filed an application to register the “leshy connect” software, which will allow the operator to remotely control the settings of home Wi-Fi networks. Formally, this is justified as “concern for connectivity”, but in reality, the system gives the security services and the government the ability to comprehensively monitor user activity, collect subscriber data, and transmit it “to the right place” upon first request.

The monopoly is no less active in carrying out the kremlin’s direct political objectives. By the September 2026 elections, “rostelecom” will have installed 860 surveillance complexes with thousands of IP cameras in the altai territory alone. Officially, this is called “voting monitoring”, but in reality, the provider’s video infrastructure has for years served as a tool to ensure the “desired” results for the authorities and to document any undesirable activity at polling stations.

Maintaining administrative resources and digital surveillance is proving far too costly for the company. “rostelecom”’s operating expenses alone jumped by 11% in the first six months of the year – to 359.8 billion rubles – due to rising costs for materials, repairs, and network maintenance. To at least partially plug the holes in its budget and refinance old debts, the operator is forced to take on more debt by issuing new bonds worth tens of billions of rubles.

On top of these systemic financial problems there is rampant corruption within the provider itself. In late July, a top manager of the local branch was detained in kirov while accepting yet another bribe from a contractor. As it turned out, the embezzlement of federal and regional funds on projects involving the laying of lines and connecting subscribers had been flourishing there for years.

As a result, “rostelecom” emerges as a typical russian state-owned entity: drowning in debt, riddled with corruption and losses due to the war, yet ready to spend its last billions to ensure that russians’  every breath and every click remains under the strict surveillance of security services.