Iranians suffer huge losses due to government internet shutdowns

Amid reports that Iranians lost more than $770 million in 2022 to deliberate government internet outages, authorities are trying to downplay the impact.

Iran’s Minister of Information and Communications Technology, Issa Zarepour, said Friday that there was no accurate data on the damage caused by internet access restrictions. However, independent VPN review site Top10VPN said in its annual report that the economic impact in 2022 was about $773 million.

While that may not seem a staggering figure in dollars, in local currency it’s hundreds of trillions of riyals and a huge loss to an economy riddled with US sanctions, inefficiency and corruption.

When nationwide anti-regime protests began in September, the government began cutting off internet access to prevent news of the unrest from spreading at home and abroad. It also aimed to prevent protesters from communicating with each other. The internet disruption lasted for weeks.

Iranian Minister of Information and Communications Technology Issa Zarepour

The intermittent disruptions have continued into 2023, largely coinciding with protests. The latest occurred on March 7, when Iranians held a nationwide rally to protest the regime’s inaction or possible involvement in the poison gas attacks on schoolgirls in recent months.

However, amid widespread criticism on social media, Zarepour dismissed the company’s estimates – and all other foreign sources – saying that “there have been dozens of estimates from foreign sources that cannot be relied on”. He added that the Islamic Republic itself has not made an assessment of the losses caused by internet restrictions.

Earlier this month, Statista — an online platform specializing in market and consumer data — said Iran will block access to social media sites and news outlets second only to Russia in 2022, affecting nearly 72 million people

A report released in January said that 20 percent of people lost their online jobs in the last four months of the previous year due to sweeping restrictions on the internet and social media. According to the Jobvision website, 46 percent of organizations have suspended or postponed more than half of their recruiting programs due to recent internet restrictions, and 45 percent of businesses or companies that depend on the internet have decided to cut their payments or have had to delay paying wages .

The Computer Union of Tehran — or Tehran ICT Guild Organization — announced in November that nearly half of Tehran’s Internet service providers had seen a 50 percent drop in revenue due to disruptions, censorship and Internet shutdowns during the protests. Union secretary Alireza Keshavarz Jamshidian said about half of ISPs lost over 500 million riyals (about $1,400) a day as sales fell. However, he added that a fifth of businesses say they have suffered a loss of between $2,800 and $14,000 a day.

The lockdown-style internet shutdown is having extremely damaging effects on multiple industries including food, medical and steel manufacturing, particularly small businesses and farmers. The E-Commerce Association in Tehran announced last year that shutting down the Internet is costing Iran $1.5 million an hour.

Despite losses from government restrictions, Ebrahim Raisi’s struggling government has issued a new decree to collect eight percent royalties on video-calling services from the country’s mobile operators.


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