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Iran’s internet blackouts are sabotaging its own economy

Iran’s internet blackouts are sabotaging its own economy

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As Internet shutdowns, platform blocks, and content filtering become increasingly common levers of authoritarian control around the world, Iran has presented a particularly dramatic case study of the economic impact and humanitarian toll of disconnections.

In September, in response to massive government resistance and protests, the Iranian regime initiated a sweeping lockdown that drastically curtailed all digital communications in the country. And Tehran runs ongoing campaigns to slow connectivity and access to popular services, including Meta’s Instagram. However, according to new assessments by the US State Department, delaying the disruptions is beginning to reveal the true economic price of the brutal technique.

Iran is already a heavily sanctioned and isolated nation, yet the government has repeatedly imposed sweeping digital restrictions and shutdowns, including notable initiatives in 2017 and 2019. The cumulative impact of these crackdowns has impacted the rights of more than 80 million people living in the Iran live, and disrupted every aspect of Iranian society, including trade.

“This is another important case in which officials show how they consistently put their own interests ahead of the public interest,” said Reza Ghazinouri, strategic adviser to San Francisco-based human rights and civil rights group United for Iran. “In the past few years, millions of Iranians have fallen below the poverty line and further restricting access to platforms like Instagram only adds many more to that number. And women are disproportionately affected. 64 percent of Iranian businesses on Instagram are owned by women.”

From communicating with customers to completing transactions, businesses rely on digital platforms in different ways, but digital disruption is impacting businesses of all sizes. Several Iranian trade associations have said in recent weeks that their member companies are reporting large losses. And some reports have revealed that the recent outage has affected hundreds of thousands of small businesses.

“This censorship underscores the extent to which the Iranian leadership fears what is possible when its people are free to communicate with each other and with the outside world,” Rob Malley, US special envoy to Iran, told WIRED in written comments.

The protest movement in Iran has gained momentum since 22-year-old Mahsa Amini died in the custody of Iran’s “morality police” while being held for alleged violations of wearing the hijab. Since September, more than 18,000 people have been arrested by Iranian law enforcement agencies in connection with the demonstrations, and nearly 500 people, including nearly 60 children, have been killed in the protests as officials use increasingly draconian violence against protesters.

An analysis of the recent shutdown by a consortium of digital rights groups, released in late November and cited by the State Department, showed that the Iranian government is employing an ever-widening array of technologies to make it harder for the population to circumvent digital restrictions. For example, the government has expanded its ability to block encrypted connections to discourage users’ efforts to hide their web browsing. Officials have also expanded their blocks on the Google Play Store, Apple’s App Store and browser extension stores, making it difficult for Iranians to download bypass tools. The results also show that there is a cumulative impact and increasing effectiveness over time as the government combines censorship, content filtering and blocking with intermittent and widespread outages.

It is difficult to estimate the exact economic impact of the digital blackouts and separate them from other factors such as international sanctions. However, due to escalating internet shutdown tactics and tolerance for self-inflicted harm, the State Department believes the Iranian regime feels more threatened by the recent protest movement than by previous waves of public opposition.

Earlier this month, in a high-profile concession to protesters, the Iranian government said it had shut down the “morality police,” which enforced restrictive laws, particularly a strict Islamic dress code for women. The laws are still in effect, however, and it’s unclear how much the move will actually impact enforcement in practice.

A State Department spokesman told WIRED in a statement that the White House is “committed to helping the Iranian people exercise their universal right to freedom of expression and access to information via the Internet.”

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