Internet Blackout, Collapsed Economy, Iran on the Path to Digital Darkness and Billions in Damages

Internet outages, a collapsed economy in their wake, and reports revealing prolonged digital blackouts and heavy damages to the economy and citizens’ lives.

The ongoing disruption and widespread cuts to global internet in Iran have now become one of the longest periods of communication restrictions in recent years; a situation that has not only disrupted citizens’ daily lives but whose economic consequences have become increasingly alarming.

Based on estimates, the duration of outages or serious disruptions in access to global internet has reached dozens of days, and the total hours of this restriction have exceeded one thousand hours. During this period, users’ access to free internet has only been possible through filtering circumvention tools and even then with high costs and limited quality.

Alongside social and psychological consequences, economic activists are warning of the severe damages from this situation. Afshin Kolahi, head of the knowledge-based commission of the Iran Chamber of Commerce, announced that each day of internet outage causes between 30 to 40 million dollars in direct losses to the country’s economy, and when accounting for indirect effects, this figure reaches approximately 80 million dollars per day.

To make these damages more tangible, he explained: “The cost of building the B1 bridge in Karaj is approximately 20 million dollars, and the cost of constructing each megawatt of a power plant requires approximately three million dollars in budget, and in reality, we are witnessing the destruction of several large bridges and power plants daily; but since these destructions are not tangible and visible, there is not adequate sensitivity toward them.”

According to experts, this level of damage can be compared to the economic consequences resulting from major crises or even military conflicts; a matter that demonstrates the importance of internet infrastructure in the modern economy.

At the international level, reports from organizations such as NetBlocks and Access Now show that internet cuts in various countries, including Iran, have become a tool for controlling unrest in recent years while simultaneously causing billions of dollars in economic damages. These reports emphasize that the digital economy, online businesses, and even basic urban services have become heavily dependent on sustained internet access.

In Iran, despite weeks passing since these restrictions, no clear prospect has been presented for the return of free internet. Fateme Mohajerani, government spokesperson, in response to this situation said: “Opening the internet is not something in our hands, and as soon as we receive official news from official sources, we will definitely announce it.”

Meanwhile, discussions about unequal internet access have intensified. Reports have been published about providing special internet services to specific groups, including economic actors and certain users, although official authorities have denied this. Satar Hashemi, minister of communications, while rejecting these claims, said that fair access to the internet is everyone’s right, but provided no details about when restrictions will be lifted.

In contrast, some other officials have effectively disclosed the creation of limited access for specific groups. Mohsen Pasha, deputy director of the National Cyberspace Center, also announced: “The list of businesses was received from five main institutions and organizations including Nasr Organization and the Chamber of Commerce, and the process of connecting them is underway. Consultations are being conducted for reopening IP addresses related to essential public needs.”

Simultaneously, digital activists are warning of a change in the nature of the internet in Iran. Hamed Beidi, an open internet access activist, said about this: “What is happening in Iran today is not intermittent internet cuts, but rather the complete replacement of it with a national information network and the transformation of free internet into an ancillary and exceptional service.”

He also emphasized: “We no longer have something called the internet today. What we have now is a national information network with domestic services available on it, and sometimes, at the discretion of officials, a filtered portion of the internet is provided to people.”

According to this digital activist, the expansion of tiered internet and the increased cost of filtering circumvention tools have deepened the digital divide. He also explained about new plans: “The ‘Pro’ internet is a continuation of the same restriction path. To obtain it, you must first be verified. Ordinary people practically do not have access to Pro internet.”

Beidi added with warnings about the future of this process: “Even if the war ends and the internet is restored in the coming days, there is no guarantee that it will not be cut again in the following weeks or face disruptions, speed reductions, or restrictions. Therefore, fundamentally we will no longer have the internet in its previous form.”

At the end, he presents a concerning picture of the future: “The issue is not just damage; it is the destruction of an entire ecosystem. No capital investor is willing to enter this field anymore, and no young person sees a positive future. Society, by losing the right to freedom of expression, is returning to the pre-internet era and even worse; these restrictions have infiltrated domestic spaces as well. The magnitude of this tragedy is such that focusing solely on economic losses means overlooking its much broader dimensions.”

Overall, the continuation of this situation has not only put Iran’s digital economy at risk of collapse, but has also surrounded the future of technology development, employment, and even social communications in the country with serious uncertainty.