The fsb has “siphoned off” the State Budget Funds for Space

In March 2026, russia launched the first 16 production satellites of the “rassvet” constellation into orbit – a project that state propaganda immediately hailed as a response to Elon Musk’s Starlink. The project is backed by “bureau 1440” LLC, a subsidiary of “x holding”. Officially, 102 billion rubles from the federal budget have been allocated for the constellation’s development as part of the national “data economy” project. Another 329 billion is supposed to come from the company itself – yet there is no evidence that these “own funds” actually exist.

“x holding” is not so much a technology group as it is a personnel reserve for the fsb. The holding’s first deputy director general is 29-year-old boris korolev – the son of fsb deputy director sergei korolev, who is already projected for the position of director of the department. korolev jr. took the position at the age of 27 – in 2023, when the holding’s official owner, anton cherepennikov, died “very conveniently”. He was 40. The official cause of death was an overdose.

The market had long considered cherepennikov a nominal owner, while oligarch alisher usmanov was named as the holding’s true beneficiary. After the founder’s death, the shares were redistributed among the managing partners, including firms where korolev jr. already held shares. In parallel, another key figure joined the holding company: 76-year-old fsb colonel general andrei fetisov, the former head of the security service’s scientific and technical division responsible for special equipment and encryption, was appointed as an advisor to the CEO. His son, maksim, was appointed head of the procurement department – that is, the person who decides what surveillance equipment the agency will purchase from its own holding company and at what price.

The portfolio of “x holding” speaks for itself: its structure includes “citadel” – a developer of SORM systems, equipment for wiretapping and traffic interception, which is installed at all telecommunications operators in accordance with the “yarovaya law”. The holding also supplies technical means of countering threats (TMCT) – the equipment roskomnadzor uses to block Telegram, WhatsApp, and other services. russia has allocated nearly 80 billion rubles for the implementation of TMCT alone. Now, that same entity is being “entrusted” with another 102 billion rubles for satellite internet.

The scale of “bureau 1440”’s ambitions and the scale of its disconnect from reality are well illustrated by simple numbers. By the end of 2030, the “rassvet” constellation is expected to comprise 292 satellites, and by 2035 – 383. Starlink already has over 10,000 satellites in orbit. The density of SpaceX’s constellation allows at least one satellite to remain within the field of view at a 15-degree angle at all times – this is precisely what made it possible to miniaturize and reduce the cost of terminals to $350–$600 per new device. In its experimental trials, “bureau 1440” used terminals based on Israeli-made Kymeta U8 phased antennas, costing approximately $25,000 each. Even if russia launches the planned number of satellites into orbit – which in itself is highly unlikely – the terminal problem will remain unsolved. There is no such thing as a mass-produced, low-cost terminal for a sparse constellation.

russia has already been through this scenario. “National search engine”, “iPhone killer”, “domestic equivalent of Rolls-Royce” – each of these projects received budget funding, propaganda coverage, and a completion date that was repeatedly postponed. Then the projects were quietly shut down. “bureau 1440” has all the hallmarks of the same genre: opaque ownership, personnel from the fsb, unattainable deadlines, and a gap between stated and actual capabilities.

The project, which was supposed to become satellite internet for the entire country, serves a completely different purpose – to ensure a stable cash flow for entities that have long since learned to convert state priorities into private income.