WSJ What’s News - How France and the U.A.E. Courted–and Hacked–Telegram’s Founder

Episode Date: August 28, 2024

A.M. Edition for Aug. 28. Six years before Pavel Durov landed in a French holding cell, Telegram’s antiestablishment CEO was in a very different position in France: having lunch with President Emmanuel Macron. The WSJ’s Matthew Dalton tells us about Durov’s complex history with governments. Plus, Ukraine deploys U.S.-made F-16 jet fighters, but says they’re not enough to counter Russia. And, General Motors delays plans for a battery factory in Indiana, its latest in a series of EV pullbacks. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Introducing TD Insurance for Business with customized coverage options for your business. Because at TD Insurance, we understand that your business is unique, so your business insurance should be too. Contact a licensed TD Insurance advisor to learn more. In a first in the war, Ukraine says it has used US-made F-16s to counter Russian drones and missiles. Plus, we've got the story on how France and the UAE tried to woo Telegram's founder, even as they spied on him. French intelligence agencies had been concerned that Telegram was being used to recruit people

for attacks in France. So from France's and Macron's perspective, having Telegram in France in the fold would be great. And GM delays its EV battery production plans as automakers downshift the electric transition. It's Wednesday, August 28th. I'm Luke Vargas for The Wall Street Journal, and here is the AM edition of What's News,

the top headlines and business stories moving your world today. We are learning more today about the Russian-born founder of messaging app Telegram, Pavel Dorov, who remains in French custody following his arrest last weekend. But far from forming a clear picture of the anti-establishment founder, exclusive reporting from the journal's Matthew Dalton and his colleagues presents an image of someone at once wooed and targeted by Western governments, and Matthew joins me now with more. Matthew, I get the sense I'm not alone in struggling to understand how to view Pavel Doroff this week after his arrest.

Tell us a bit about what you and others of the journal have been able to learn about him. Well, he has a fraught relationship with a number of governments around the world, including France. Just six years ago, Pavel Doroff was invited by Macron, the French president, to have lunch. And Macron invited him to move his company Telegram to Paris. And we're told that by people familiar with the discussions. Macron has a history of trying to attract tech talent to France. French intelligence agencies had been concerned and growing more so

that Telegram was being used by Islamist militants to plot attacks in France and to recruit people for attacks in France. So that was kind of in the background to the lunch from France's and Macron's perspective, having Telegram in France in the fold would be great. At the time, Durov had left Russia under pressure, he says, from the Kremlin to turn over the private communications of Ukrainian protesters. So he was kind of bouncing around the world. He was potentially going to set up in the United Arab Emirates and Dubai, but things

were up in the air. And so the two men discussed whether he could become a French citizen and move to Paris, according to our reporting. At least the citizenship part did eventually happen a few years later. And in fact, the UAE also granted him citizenship and invested in his platform. And yet you report that in 2017, actually the year before this meeting with Macron, the French and the Emiratis were attempting to hack Derov's phone. Yeah.

So our sources say that this joint hacking operation was successful. We don't know what they found, but it's indicative of the intelligence trove that Telegram was seen to be and is still seen to be. Intelligence agencies all over the world would love to infiltrate the apps, encrypted messaging capabilities. It's now become particularly important with the war in Ukraine because Telegram is the most popular messaging app in the post-Soviet world. In Gaza too, right? Yeah, in Gaza too, in a number of different countries. It has around 900 million users

worldwide. And particularly this year, right, as we try to kind of make sense of the current moment, there's anxiety, particularly in France, about sabotage or planning occurring there, all sorts of other illegal commerce, the spreading of misinformation, racism, anti-Semitism on the platform. Yes. And that's not unique to Telegram. The issue of online platforms, social media networks being used to spread information,

to exchange illegal content, child pornography, drugs has become a growing concern across really the West, but particularly in Europe. So Telegram is now under really a legal obligation to cooperate with Europe, given that it has millions and millions of users in Europe. So the issue is that Telegram in particular has taken this approach of almost no moderation, total hands off, for a long time. We report on our story, according to a person familiar with the situation, that for years there was an email box at the company where various authorities could email subpoenas and other government requests.

And that email box was rarely checked. And that gives you a sense of the ethos of the company. Telegram says it does comply now with the EU's Digital Services Act. That is sort of the main reason that Durov was arrested. This French investigation is examining whether online platforms, including Telegram, are complying with the law and are countering the spread of this illegal content. So a fascinating sort of contradictory profile there of Doroff and of Telegram, maybe ignoring the carrot, also ignoring the stick in terms of interactions with governments.

We've left a link in our show notes for listeners to read your full piece, which they really should do. But that brings us to where we are now. The French, as far as we understand, need to make a decision today about whether to release Doroff or to charge him with a crime. What do we know about their likely next steps? We don't know much. They face a dilemma, which is do they want to keep him in Europe? Because if they release him, there's a chance he could never come back. And there's also questions about whether he's going back and forth to Russia. The Russian foreign ministry demanded consular access to him when he was arrested in France.

So we don't really know what the relationship is like between Duraev and the Kremlin. What's the real story there? A lot of people speculate that, but it's kind of a mystery. I've been speaking to Wall Street Journal reporter Matthew Dalton in Paris. Matthew, thank you so much for joining us. Thanks Luke. Ukraine says it has used US-made F-16 jet fighters for the first time, shooting down drones and missiles sent by Russia in what was the second barrage targeting Ukrainian infrastructure in as many days. The F-16s, which Kiev had long been calling for, began arriving in Ukraine this summer.

However, President Volodymyr Zelensky said yesterday that the jets were quote, not enough. He also said Ukraine had successfully tested a domestically produced ballistic missile which could enable Kiev to strike harder and deeper into Russian territory. The Journal's Ukraine Bureau Chief James Marson told us more about Zelensky's strategy, as he contends with an increase in attacks by Moscow following Ukraine's lightning invasion of Russia's Kursk region about three weeks ago. The problem for Zelensky is he needs to create a situation where Ukraine isn't on the back foot.

So it appears that his idea was that this incursion has now shown to Russia that Ukraine can take part of Russia and have something to trade in potential future negotiations. And Zelensky's been clear in order for Ukraine to be able to bring an end to this war in the way that it wants, it needs to be given more weapons. It needs to be able to use the weapons that it has to strike into Russia, which is barred from doing with some of the longer-range missiles by the Biden administration. So this is part of Zelensky's plan to show to Washington, this is how we think we can end this war, but we need your support and more permissions to use weapons in order to do it.

A U.S. official said the White House has no plans to alter its policy, preventing the use of some Western weapons on targets inside Russia. Coming up, why record harvests aren't giving U.S. farmers much cause for celebration, and General Motors delays its Indiana battery factory in the latest EV pullback. We've got those stories and more after the break. Good weather across the Midwestern U.S. farm belt has corn and soybean harvests on track to set records. But with grain prices under pressure and corn futures trading at their lowest level in years,

Journal Commodities reporter Kirk Maltes told us that few American farmers will be celebrating. The price that they're receiving for their commodities is just simply not covering the higher costs that they have to pay for inputs, including fertilizer, seeds, farm machinery, that sort of thing. And it's just put them in a position where they're likely going to be seeing negative returns on their acres this year. And the competition that they're seeing from other grain exporting nations is also stronger than it has been in previous years. Brazil is shipping a very sizable crop as their agricultural industry continues to grow at a breakneck pace.

Meanwhile, for Russia, they're the world's leading exporter of wheat. And despite the Russia-Ukraine war fighting over there, it does disrupt the supply chain to some extent, but they've been able to get around it. General Motors is pushing back the start of production at a new EV battery plant in Indiana by a year, with the Detroit automaker and its partner Samsung SDI saying yesterday that the $3.5 billion factory won't become operational until 2027. The announcement comes after GM last month delayed plans for a new electric Buick and has abandoned

its goal of having enough North American factory capacity to produce a million EVs in 2025, amid signs of slower consumer adoption of EVs than carmakers had hoped. And in other news that could move markets today, NVIDIA is set to post earnings after the closing bell. The chipmaker has been on a tear amid the AI boom, and analysts are expecting it to report revenue just south of $29 billion for the quarter ending in July compared to $13.5 billion a year prior. Though with the pace of growth slowing, investors will be listening for details on when to expect Nvidia's next-gen AI chips after it told customers earlier this

month that a design flaw could delay their arrival from January till some point next spring. And earnings from the likes of HP, Salesforce, and cybersecurity provider CrowdStrike, whose software update last month caused a crippling global tech outage, will also round out the trading day. And before we go, while students were on summer break, a number of U.S. schools have adopted policies to ban the use of smartphones, with the goal of helping kids focus on learning and interact in real life. And whether you're a parent, a teacher, a tech expert, or a mental health professional,

we want to know what you make of the push to ban phones in schools and what questions you have about how educators are trying to manage tech. To weigh in, send a voice memo to wnpod at wsj.com or leave a voicemail with your name and location at 212-416-4328 and we just might use it on the show. And that's it for What's News for Wednesday morning. Today's show was produced by Kate Bulevent and Daniel Bach with supervising producer Christina Rocca, and I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a new show, and until then, thanks for listening.