ashlee: hello, world. [clock chime] ashlee: it's time for a thought experiment. let's imagine the cold world went another way. after the nazis surrendered, the soviet union flexed its muscles .nd asserted its imperial might from tokyo to tacoma, memorials to the fatherland popped up around the globe. this would be the washington monument. this would have been your morning commute.

now, let's fast-forward. these were the first semi conductors. this is your keyboard. this was the first ibm computer. this is facebook headquarters. this is silicon valley. well, that didn't happen. but in modern russia, it's easy to get confused. with an extra helping of spy craft, technology here developed a world apart from silicon valley, and that did not change when the soviet union collapsed. [cheering] ashlee: 25 years later, russia has copied large parts of the web the rest of us know and love. they built a russian internet.

and with new laws cooked up by the kremlin and rubberstamped in moscow, more and more it is a sovereign internet. like anything sovereign, it needs walls to protect it, and virtual walls are going up today. to find out exactly how the russian web works, there was only one thing to do. i had to upload myself. ♪ ashlee: now that i am inside, i will meet a tech oligarch and travel to siberia to dive into a surprising and very remote team, and chase the ever allude is -- ever elusive russian hacker. let's enter this parallel universe together on this

episode of "hello world." ♪ ashlee: silicon valley may be home to some of the biggest tech giants in the world, but it is being challenged like never before. crazy tech geniuses have popped up all over the planet making things that will blow your mind. my name is ashlee vance. i am an author and a journalist, and i am on a quest to find the most innovative tech creations and meet the beautiful freaks behind them. >> hello world. ashlee: in moscow over the past decade, czars, churches, and monuments to the proletariat have given way to the monuments of modern russia. opulent, capitalist towers that poke through the clouds. at the heart of this is where i

met dmitry grishin, the cofounder of a company and one of the only people east of helsinki who can drive me to the office in his own tesla. -- ee: dmitry sits atop a russian tech empire and runs an investment fund for robotics with its roots in silicon valley. does it make you want to move there? dmitry: maybe one day. never say never, right? ashlee: overall, do you consider the russian tech scene competitive?

ashlee: why are russian engineers so good? so everyone knows when you're in the office? >> yes. ♪ ashlee: dmitry has tried to copy silicon valley culture here in moscow where mail.ru runs a search engine, to messaging groups, a price comparison website, a ton of online games. they also control russian networking sites. the biggest one is vk, a facebook knockoff. dmitry and mailroom group took

it over in 2014 after its founder refused to reveal information about ukrainian activists to the kremlin. he lost his company and now lives in self-imposed exile. dmitry is also one of the world it is investors in robotics. he put $100 million in two american firms that produced some familiar faces. what is been the biggest hit of all your robotic companies? ashlee: dmitry ships all kind of gear to moscow. what is the play of the game?

ashlee: to get a taste of the high life of a tech oligarch, dmitry and i headed for a bite to eat at the tallest restaurant in europe, 354 meters above moscow traffic. tell me a little bit about your family history. his hometown was the answer to area 51. a top research laboratory where his uncle tested ballistic missiles and rockets during the space age. dmitry grew up programming on computers that plugged into

soviet televisions. things really took off when he enrolled in moscow state technical university in 1995. ashlee: he might have failed to rewrite the world's most popular operating system, but he did stumble on the copycat business model that became mailroom group. at the height of the 2001 tech crash, he had to find a way to keep the new company alive with no cash.

ashlee: it's hard to imagine now, but, in 2004, only 9% of russians had internet access. what was the russian government's assessments of the technology industry? ashlee: than 2012. russia had become the biggest internet market in europe. some people used the web to complain about vladimir putin and organized protests to prevent his reelection. the kremlin responded in full orwellian glory with a series of laws allowing them to flag opposition sites as extremists and blacklist them. ever since, it has been hard to tell where the vlad web begins and ends.

>> i think in the u.s., the idea is that the russian government and tech companies are just intertwined. that if the government wants to read emails or whatever they want to do, they will allow people to do that. ashlee: those new laws passed this year would make edward snowden weep into his borscht. it demands that all sites access -- all sites russians could access move their servers here. including googles and facebooks of the world. they have to store six months of data about people's every move

online and then give the kremlin access. companies like mailroom protested. they said these measures would take a ridiculous amount of storage space. but they obviously lost. american companies have said there is no way they are moving to russia, so now they are criminal enterprises here. and that's how you build a sovereign internet. ashlee: just a couple of weeks

after we visited dmitry, he stepped down as ceo. a government approved ceo is taking his place. the new guy also has -- also happens to be the son of the head of russia's largest state-run channel. coming up next, it's off to siberia where the russian government is trying to build a tech utopia in the tyga. >> "hello world" is supported

by ca technologies, powering opportunity in the application economy. explore more at ca.com. ♪

ashlee: to find out how russia

makes technology happen come on you to do is hop on a flight from russia to that area. yes, that is siberia. it is not just for gulags any more. ♪ ashlee: it's hard to wrap your head around just how big siberia is, and even harder to understand how most people live here. so, to get acquainted, i found another dmitry. this one, a real, natural born, siberian man to initiate me into the ways of the russian. >> perfect idea. ashlee: a trip to the bana is an -- banya is an ancient, and some would say masochistic, russian ritual. it consists of three delightful steps.

step one, nearly have heat stroke. step two, shrinkage. step three, get wet. what does this do? ashlee: when he is not beating other men with birch branches, my other friend dmitry is a philosophy professor. that's my destination, a small town hours by plane from moscow and about 30 minutes outside russia's third-largest city, novosibirsk. nikita khrushchev's government declared 60 years ago that this

would be the siberian home of the soviet academy of sciences, build from nothing in the middle of a remote forest that stretches halfway around the planet. ashlee: shall we toast? what shall we toast to? >> no pity to the enemies of science. [laughter] ashlee: cheers. ♪ swatted, steaming,

in having -- and having proven my loyalty to science, i was ready to explore. here, the soviets hid temples to science in the trees with shrines to match. like this one. to all the mice they sacrificed on the altar of genetic research. inside the nuclear physics institute, it feels like i walked onto the set of "dr. strangelove." analog dials, laser contractions and miles of metal pipes were all built to push nuclear science to its summit, replicating the sun's power by smashing atoms together. people have been chasing fusion for decades. what is still encouraging and exciting about this field? ashlee: professor alexei

researches something called open trap mechanisms to encourage fusion. in theory, it is a shortcut to the top of the mountain with a smaller load. ashlee: the soviet government attracted brilliant minds like alexei's to siberia with spacious apartments and the kind

of prestige spake it only get in -- you can only get in a town founded as a utopian nerdocracy. but when the soviet union fell, so did the walls keeping scientists here, and many of them bolted to work at ibm or m.i.t. or boeing. for those who stayed, the utopia has lost its luster. ashlee: 10 years ago, the russian government decided it needed to hit refresh on the entire town, to pull siberian science out of its post-soviet slump. they are turning to a new generation of engineers.

one of the most successful so far is dmitry. yes, another dmitry. ashlee: his company started off making king-sized air is the spot you would go? ashlee: today, dmitry is the poster boy for a siberian startup success story.

he feels like he is close to the finish line on phase one of his vision. phase two takes them to china where his company is rapidly expanding. there, he hopes to get his devices out of hospitals and into homes. like this little guy that detects pollutants in the air like co2. dmitry is not a completely self-made man. it is built on a blueprint drawn up by the russian government. his headquarters is on a sprawling government-funded

campus with a crazy tower in the middle of it. not recommended if you have a fear of heights. this place is a prime example of one of the big ideas in russian tech, a cradle-to-grave genius factory. ♪ ashlee: across the country, they start them young with a strictly uniform education heavy on math and science. they pull the best out of siberia and send them down the street to novosibirsk university. from there, they used a funnel -- they used to funnel their brains to places like the nuclear institute, but now that that's a bit retro, many end up here in the tech tower. it's like someone visited a few silicon valley startups, pushed a copy button, ran it through google translate, and clicked paste in the middle of siberia. here is the living wall, only here it is dead.

here is the maker space. here is the 3-d printed putin. here's the gym, only it's siberia, so it comes with bears. hello, innovation. [wind blowing] ashlee: case in point, my new friend. where your fathers and mothers engineers, as well? ♪ you can tell by the terminator looking device on the table that he makes drones. he says that his drone is special because it can take off vertically and then fly very far very fast. he flies the drone along high

tension power lines checking for breaks. engineers barely out of high school and most definitely still in college this carbon fiber prototype by hand in four months. ashlee: so, this drone company started in a russian government-funded incubator. it was too radical for its clients who, maybe you guessed, are a part of the russian government. their first contract came from the russian version of fema. they built the first prototype by a russian government backed

capital firm. they would not exist without the government, and they barely exist because of it. ashlee: are there many drone companies in russia? ashlee: it looks very cool. >> like skynet. ♪ ashlee: it is through sheer force of their engineering smarts and planning the day have gotten off the ground. out here in siberia, they are part of one grand experience in state driven innovation.

up next on "hello world," i hit the streets of moscow to shatter what remains of your illusions of personal privacy. >> i would say the implications of this are very scary. ♪ >> hello world is supported by ca technologies, powering opportunity in the application economy. explore more at ca.com. ♪

♪ ashlee: there is been a better time to take in the epicness of modern russia. the wealth that has poured into the country has remade modern moscow into a european capital. it is now supersized. now, it is home to bohemian

cocktail bars and some of the best restaurants in the world. the result is something intimidating. , well, romantic. if you come from the west, you can live like an oligarch on the cheap. sanctions and low oil prices have cut the ruble in half. it doubles the fun for outsiders like me. ask anyone here, and they will tell you that tensions with the west will not diminish the russian soul. ♪ ashlee: russia's power comes from the force of its intellect. that is on display here at the gallery where the country's most iconic modern artists hang from the walls. it got me thinking. what is art really? an object? an idea?

this one is swirly. i wonder what this app does? ♪ ashlee: this app gets five stars for sure. it is called prisma, and its creator uses machine learning magic to rebuild your photos into something that can hang in a museum. does this look similar to one of

your filters? on? would prisma pick up prisma top 2 million downloads a day earlier this year. they program a vast network of computers to study artists and then repaint your pictures from a blank canvas. compared to that, instagram filters are weak sauce. have you trained in neural net to do something like that? so, you take something like as cosco -- the cost so -- thenhing like pacaso and --

♪ ashlee: to put another footsoldier in that ai army to the test, i would across the street to one of moscow's spectacular public spaces. just five years ago, this was a decaying soviet relic. today, it is buzzing with people on wheels and family russian faces. -- friendly russian faces. my goal here is to find a few. hello. would you mind if i take a photo of your face? we are doing a little bit of an experiment. can i take a photo of you? i want to see if i can find your profile. facebook. find me on

ashlee: it lets you take a photo of a friend or a complete stranger, and in a moment it scans all the 250 million photos from vk, the russian facebook, and finds a match. let's see what happens. moment of truth. here we go. >> it's me. definitely. >> it's me. >> yes, it's me. ashlee: your hair is so different in the photo. >> definitely, it finds me first. so, it works. ashlee: it is really cool. do you think it is strange? >> it is strange, but cool. so, you like it? ashlee: this year, find face took its algorithm to america for something called a mega face

challenge. there, it beat google and a lot of other face-spotting software. to find out how they did it, i went to meet the algorithm's creator at the office of his company. do you mind showing me how the technology works a little bit? can we try me? these are my russian brethren, my cousins. [laughter] ashlee: is it ranked in order by who they think looks the most like me? >> yes. ashlee: this is like a 16-year-old with a machine gun. another guy with a gun. i want to show you something else. why am i a bear? ashlee: artem programmed a

neural network that approaches face finding differently than others. he said it thousands of image matches, and after about six months of training, voila, it learned to read faces. essentially, you don't really know what the network is seeing. ashlee: are we creeped out yet?

maybe we should be. they have already signed a contract with the moscow city police, though artem is not talking about it. he says they already have agreements with other law enforcement agencies inside and outside russia. it's easy to imagine what the fbi, or its russian counterpart, could do with this kind of technology. so, it's a little controversial, right? anyone can identify do now out of the crowd. >> yeah. >> the implications of this are very scary. ashlee: this idea that you are

not anonymous when you walk the street anymore, somebody can snap your photo and identify who you are, you must've thought about that when you are developing the technology. ashlee: on the outskirts of moscow, this is the mothership of state-sponsored innovation. the kremlin is coaxing the parties and workers here with promises of government support. i came here to take in its

hugeness and meet one of its rising stars. . criminologist how are you? >> i'm good. it is nice to see you. private company based in moscow that tries to find ever elusive russian hackers, unmask them, and then hand them over to the authorities. ashlee: in your photo, you look like james bond. >> this is a photoshop. fraud: they investigate and theft. the kind of stuff that takes up 99% of cybercrime.

ashlee: they walk a tightrope. they are cooperating with russian law enforcement while serving major international clients like citibank and microsoft. you have foreign clients, huge tensions, but as between china, u.s., and russia seem to be escalating when it comes to cyber security -- ashlee: it just seems like that would make it so much harder for you guys to expand your business.

ashlee: do you think that with the tensions between the united states and russia right now, rest would be upset if you had an office in silicon valley? ♪ ashlee: you think of hackers as these guys sitting in their eestnet with hats -- in their basements with hats and hoodies

on, while this is what the people who hunt them look like. ashlee: he started the group in college with a few buddies. one of them is the company's head hacker hunter.

ashlee: i visited her moscow office to find out more about how he chases cyber criminals. is the russian hacking community , is that the biggest cybercrime community in the world? ashlee: what is the art of that in the technique -- and the technique?

ashlee: what does a russian hacker look like? who are these people?

ashlee: they now occupy an uncomfortable position at the intersection of cold war geopolitics and organized crime. during an early group investigation, he learned that one of their target had ordered the monsters to kill him. sters to kill him. [applause] ♪

ashlee: peace on cyber earth may come, but just in case russia is building sovereign cities to extend the might of its sovereign tech. to an outsider like me, the depth of russia's state influence on companies feels flat out backward and wrong. it's hard to imagine a true tech utopia springing up in a place like this. edward snowden, yes, he's somewhere out there.

he would say the u.s. has its eyes everywhere, too. whether you are in this internet or that one, you're never alone anymore. up next on "hello world," i travel to chile to go hunting for the origins of the universe and find myself with the help of a shaman and some low-tech frog poison. ♪ >> hello world is supported by ca technologies, powering opportunity in the application economy. explore more at ca.com. ♪

♪ emily: i am emily chang and this is the "best of bloomberg technology." we re-bring you all of the top interviews from this week in tech. e watchdogs center message to big tech. move faster to crack down on hates each or we will do it for you. plus, the best of the best in science that celebrity treatment in silicon valley at the fifth annual breakthrough awards. we will hear from the russian billionaire who helped start it, yuri milner. so much for burning the midnight