Russia has fired the first shot in its attempt to muzzle foreign tech firms from operating without tight government regulation in the country. The unfortunate firm in the line of fire is LinkedIn, the website for professionals to connect with each other.
Yesterday, a court in the country passed judgement that the social networking website breached major aspects of Russia’s data protection rule.
The current ruling by the court basically affirms the decision of an earlier court ruling on LinkedIn.
The particular law that LinkedIn breached was passed last year by the country’s parliament. Basically, the law said that any tech firm that has user data of Russian citizens must have servers or data centers domiciled in Russia where this information must be stored.
According to the lawmakers, this is to protect the information from hackers.
The number of people using LinkedIn in Russia is just about five million out of a total of about 500 million people worldwide who have accounts on the social network.
In real terms though, five million users is not a big number to get into a muddle about. But analysts see this as test run for bigger fishes to go after in he future.
In this case, the bigger fishes are companies like Facebook Twitter and Google who also have data on Russian users but don’t have the information on servers in Russia.
The fact of the matter is that this is not really about protecting user information from hackers. Countries like Russia are increasingly bullish about the need to control what their citizens do on social media.
This crackdown on social media emanated from political protests in 2012. That year, political activists in Russia used social networks like Facebook and Twitter to mobilize people against the re-election of the current president, Vladimir Putin.
It was the same year, after the protests that hackers stole millions of LinkedIn user details. The belief was that the hack was state sponsored to undermine social media sites in Russia.
Russia’s attempt at the localization of data centers follows the same ruling passed by the government of Iran earlier in the year. Six months ago, the authorities ordered that all messaging apps like Facebook, WhatsApp and Telegram must move their servers to the country or face a shut down.
They were all given 1 year to comply.
This development comes at a particular sensitive time as LinkedIn just signed an agreement to sell the social network to Microsoft. According to the deal, all things being equal, Microsoft would handover $26.2 billion by the end of the year to be the new owners of LinkedIn.
How this latest ruling would affect the deal is no clear yet. Losing just five million subscribers is not a big thing if you have about half billion users. But Microsoft might be wary of going against the government as they have a big presence in Russia.
One might argue that the problem could have being avoided if LinkedIn had just built the servers in Russia. But it all boils down to privacy of users.
Authorities of countries like Russia are notorious for never respecting privacy issues in the name of state security. Having the data centers in countries like Russia means the security services can go in and raid the centers for vital personal information anytime they feel there is a threat to the regime.
Today it is LinkedIn, the likelihood that bigger social networks like Facebook are the real targets of this move. This could just be a test run before a move is made on other social networks.
The ruling might be enforced as early as Monday. LinkedIn however intend to appeal the ruling.
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