Iran's monthslong internet shutdown is crushing businesses in an already
battered economy
[May 01, 2026] By
NASSER KARIMI, MEHDI FATTAHI and AMIR-HUSSEIN RADJY
TEHRAN, Iran (AP) — At her studio in Iran's capital, Amen Khademi
prepared a fashion shoot for a jacket she designed with Persian-inspired
motifs. But even as she applied lipstick to the model, she was
distracted, worrying if her business would survive after four months
without its main link to customers — the internet.
Iran's 90 million people have been cut off from the internet for most of
2026, one of the world's longest and strictest national shutdowns. That
is devastating an online economy that had long defied government
restrictions and international sanctions. From fashion to fitness, to
advertising and retailers, many have seen their incomes evaporate.
Khademi hasn't made a sale in months. “The internet outage in the past
four months has completely destroyed not only my business, but many
online businesses," she said.
Despite an uneasy truce with the U.S. and Israel, Iran’s rulers have
refused to reverse the shutdown they have depicted as a wartime
necessity. But they are facing an outcry as it adds to mass job losses
from strikes on key industries and an ongoing U.S. blockade.
Before January, Iranians could access the internet, but authorities
blocked a large amount of content. Now all access to the global web has
been shut down. Some workarounds exist, but they have become enormously
expensive, out of reach for most Iranians.
The internet cutoff costs the economy an estimated $30-40 million daily,
with indirect losses likely twice that much, a member of Iran’s Chamber
of Commerce, Afshin Kolahi, told a local newspaper. About 10 million
people have jobs that depend on internet connectivity, according to the
communications minister, Sattar Hashemi.
An unprecedented shutdown guts an online economy
Throughout years of economic turmoil in Iran brought on by sanctions and
mismanagement, platforms like Instagram and WhatsApp helped small
businesses to find customers, and people to earn extra income to afford
skyrocketing prices for basic goods.
Iranian authorities first shut down the internet in January during mass
anti-government protests. That cutoff was just starting to ease when the
government imposed a complete internet blackout on Feb. 28 as the U.S.
and Israel launched the war.
Mahsa Alimardani, an expert on internet censorship, said Kashmir and
Myanmar have had longer blocks affecting specific regions or platforms.
Countries like China, with its “Great Firewall,” and North Korea, have
always strictly limited access to the global internet.
“What makes Iran’s shutdown unprecedented is the combination of scale
and severity: an entire country of 90 million people with a developed
digital economy deliberately reverted to a controlled national
intranet,” said Alimardani, an associate director for technology threats
and opportunities at the rights group Witness.
A flagship company of Iran’s digital economy, online retailer DigiKala,
recently said it was laying off 200 people, about 3% of its workforce.
The pain extends to “production, foreign trade and even traditional
business,” Reza Olfatnasab, head of a national group representing
digital businesses, said in comments published in Iranian media.
Khademi's shopfront is Instagram. But her studio’s page — with more than
30,000 followers — is now inactive. She was doing the photo shoot to
save the pictures for later, hoping to find an alternative.
Her model, Farnaz Ojaghloo, is also a fitness coach. The shutdown has
dried up both her modeling gigs and the online courses she ran for
people inside Iran and abroad.
“Psychologically, it really hits hard,” Ojaghloo said. “All the plans
you had for six months or a year ahead get pushed aside, and your only
concern becomes surviving in the moment.”
The alternatives are ‘terrible’
For years, authorities in Iran have enforced filters and policed content
on platforms like YouTube and Instagram. But before the war, Iranians
could bypass restrictions with cheap virtual private networks, known as
VPNs, and other easy workarounds.
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Two women use a smartphone in northern Tehran, Iran, Sept. 28, 2025.
(AP Photo/Vahid Salemi, File)
 Now, the shutdown has stoked high
prices for black-market VPNs. Iranian state media routinely report
arrests of people for using illegal VPNs or the American satellite
system Starlink, which was banned last year.
Senior government officials are awarded “white” SIM cards granting
them access to the global internet. Under pressure to alleviate the
economic harm, the government is now allowing less-restricted
internet access to a small number of professions, business and
media.
An e-commerce trade group in Tehran condemned the tiered system in
Iranian media on Wednesday, calling it “an abuse of an obvious need
of every citizen.” It said the outage threatens “the destruction of
the country’s infrastructure at the hands of our own
decision-makers.”
The vast majority of people have no choice but Iran’s national net.
A Tehran resident who works in advertising said sponsors have little
interest in paying for content that can’t be posted on major
platforms like Instagram, where he has tens of thousands of
followers. He said his income is down to near zero since the war
began.
A gamer in Isfahan — also with a large following on YouTube and
Instagram — said Iran’s domestic net “is terrible” — slow, insecure
and full of bugs. He too has lost almost all his income from
sponsors and donations.
Iran has its own social media platforms modeled on services like
WhatsApp and YouTube, but content is closely monitored and often
censored.
“Nobody really wants to use these platforms, but there is no other
option,” the gamer said. Both he and the advertising worker spoke on
condition of anonymity out of security concerns.
A growing number of street vendors
The shutdown has piled new pressures on Iran’s once large and
educated middle class, already struggling in the face of a prewar
currency crash.
Economic decline in Iran has spurred waves of anti-government
protests, most recently in December. Now, more Iranians are thinking
of emigrating, a software developer said.
The developer — likewise speaking on condition of anonymity out of
safety fears — said the internet shutdown has wiped out remote work.
He lost his own job when his former company laid off almost all its
employees in recent weeks, he said.
The consequences are visible in the rising numbers of street
peddlers in Tehran. Reza Amiri, a 32-year-old former employee of an
internet provider, now sells hats and umbrellas by a metro stop. He
lost his job after the war started and has not received his last
month’s salary, he said.
Monireh Pishgahi sells ornaments and accessories on the capital’s
famed Vali Asr Street. She said her tailoring business used to
supply three online shops. As business dried up, she shut down and
laid off her five employees.
One downtown shopkeeper, Mohammad Rihai, said he had given up on
trying to persuade street vendors to stop blocking the sidewalk
outside his store. “After the war, you see them all along the
sidewalk. I cannot fight them anymore.”
___
Radjy reported from Cairo.
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