Russia’s Internet Crackdown Disrupts Small Businesses and Online Sales
By Nika Khutsieva
Impact of Internet Restrictions on Russian Businesses
MOSCOW, May 8 (Reuters) - Russian dogwear entrepreneur Natalia Kukovinets has had to switch messaging apps multiple times to stay in touch with customers, one of many web-dependent businesses struggling with the Kremlin's widening internet crackdown.
Restrictions on popular messenger apps such as Telegram, curbs on VPNs, and security-linked mobile internet shutdowns have affected much of Russia this year, but the unpredictable outages pose a particular headache for many small companies, with billions of dollars in digital sales at risk.
The Role of Messaging Apps in Business Operations
Despite state efforts to rein in its use, Telegram remains one of the top messengers. It has been the only source of sales for Kukovinets's Wag’n Tails brand since Russian authorities restricted Meta's Instagram in 2022 and WhatsApp in February.
"Telegram is basically everything when it comes to client communication," said Kukovinets, standing in her Moscow workshop where she makes embroidered hats and clothes for dog-lovers.
Challenges Faced by Entrepreneurs
But "it has become harder to track incoming requests. It does not work without a VPN turned on, and notifications often do not come through," she said, wearing a custom t-shirt declaring: 'Peace, friendship, puppy'. She is not the only one feeling the squeeze. Around 2.9 million small-to-medium-sized firms and 14.1 million self-employed individuals use messaging apps for business, state news agency Interfax reported last September.
Government Response and Business Losses
Nevertheless, this week the Kremlin said it would not compensate businesses for losses suffered as a result of its days-long shutdown of mobile internet coverage in Moscow. It jammed coverage in the capital for nearly three weeks in March and regularly blocks it elsewhere.
Russian President Vladimir Putin has said such internet restrictions are essential for security. But the policy has faced rare pushback from the business elite and over two-thirds of Russians believe it has made life more difficult, according to a March survey by independent pollster Levada.
Consequences for Customer Relations and Sales
‘The Customers Started Shouting’
Moscow restaurant Skrepka said a restrictions-linked glitch in April left it unable to process the many online orders for its traditional iced Easter cakes.
"Telegram was down, so the customers started shouting," said manager Daria Teterina. "It was a reputational loss."
Economic Impact of Internet Curbs
There is no official data on the economic impact of the various internet curbs. But goods and services sold via digital platforms totalled 11.5 trillion roubles ($153.74 billion) in 2025, the Association of Internet Trade Companies, an industry body, said in March.
Communication Barriers and Revenue Losses
"When I’m in the city centre, I don’t see messages until much later," said Anton Belykh, who runs Moscow-based property firm DNA Realty. "Overall, it creates a lot of inconvenience. Clients lose revenue, communication becomes more difficult, and both we and our clients end up losing money."
Future Outlook for Messaging and Online Business
State-backed Alternatives and Public Skepticism
The Kremlin has rejected criticism that the measures represent a return to the repressive information control of the Soviet era and says they are temporary.
But it appears unlikely that access to messaging apps will return to normal any time soon. The authorities are pursuing a criminal case against Telegram's founder. They are also promoting a state-backed messenger called MAX, though some Russians are wary of using it and refuse to download it.
Business Adaptation Strategies
Belykh said just 2-3% of his clients communicated with him via MAX, while Kukovinets of Wag’n Tails and the restaurant manager said they would continue using Telegram when possible.
"There is... a risk that not all our customers would be ready to move to platforms that are currently allowed. So we made the decision to stay with Telegram," said Kukovinets.
($1 = 74.8000 roubles)
(Additional reporting by Ekaterina Maksimova; writing by Alessandra Prentice; editing by Gareth Jones)
