The ongoing internet censorship in Iran has been a significant hindrance for digital entrepreneurs and online space advocates. Initial restrictions began in November 2019 as a reaction to protests over high fuel costs and have escalated since September 2020. Consequently, accessing social networking platforms has become increasingly challenging.
A study from Comparitech, a British non-governmental organization focusing on security and the private sector, ranks Iran second only to China in social media censorship. Furthermore, Iran is the third nation, following North Korea and China, to enforce stringent internet restrictions globally.
These constraints, combined with an economic downturn, have generated a unique and difficult landscape for Iran’s online businesses.
Data from the research center of the Tehran Chamber of Commerce reveals a sharp drop in the purchasing managers’ index in production and service sectors, from over 60% in June 2022 to 53% in June this year. This drop signifies economic stagnation.
Despite the continuous economic downturn, internet censorship and filtering in Iran have been consistently escalating, posing challenges for many. However, some individuals and entities have figured out how to profit from these restrictions.
Jalal Rashidi Kochi, a parliamentarian, provided insights into this in an interview with the Asr-e Iran website. He discussed the emergence of a profitable and cunning market that thrives behind the filtering curtain, with a staggering annual turnover of 40 to 50 trillion tomans.
In an attempt to bypass these restrictions, some individuals have resorted to buying and selling SIM cards from countries like Estonia, England, U.S., and Canada, which are known to function without disruption in Iran. These SIM cards are exchanged at high prices, from 10 to 90 million tomans.
However, despite these strategies, the online shopping and sales market remains stagnant and is not reaching its full potential. In the first half of last year, before the new restrictions were implemented, the financial turnover of the online market was reported to be 1,230 trillion tomans, which was a significant portion of Iran’s total liquidity, around 5,401 trillion tomans.
This figure pertains to companies and businesses that have a certificate from the Ministry of Industry, Mines, and Trade and are registered as “E-Namad” or union members. (To function as legitimate online businesses, companies in Iran can acquire an Electronic Trust Symbol —(E-Namad) —from the E-Commerce Development Center, which serves as a credibility indicator for online consumers.) Therefore, the actual turnover could be even higher than the publicly released number.
Instagram plays a significant and unique role in Iran’s online business environment, being the most popular social networking platform in the country.
As of 2021, the Statistics Center reported that approximately 68% of Iran’s population over 15 years old, equating to around 42 million people, are active Instagram members, making it the social network with the most significant user base.
According to the Electronic Commerce Development Center’s report, Instagram’s financial turnover was estimated to be between 25 and 30 trillion tomans, contributing about 2.7% of the country’s total e-commerce turnover. When considering revenue from advertisements, Instagram Stories, and other related features on the platform, this percentage increases to approximately 3.5% of the overall financial turnover in this sector.
Amin Kolahduzan, the head of the e-commerce development center, estimated that between 300,000 and 350,000 individuals manage e-commerce pages on Instagram. The number of businesses involved in this platform is even higher, ranging from 600,000 to 800,000.
Currently, around 415,000 Iranian stores do business on Instagram, demonstrating the platform’s popularity for online businesses.
Before the new restrictions, Instagram facilitated a considerable number of daily buying and selling orders, ranging from 310,000 to 470,000 orders. This had a direct effect on employment opportunities for about one million people.
A breakdown of the industrial distribution within Instagram’s e-commerce business landscape by Tekrsa, an Iranian technology media startup, reported various sectors including clothing, food and beverage, cosmetics, bags and shoes, home and kitchen, digital, and others.
The government’s restrictions on Instagram have certainly impeded its accessibility and posed significant challenges for Instagram businesses, resulting in a market slowdown.
Access to social networks and messaging platforms such as Instagram, WhatsApp, and Telegram remains a challenge due to censorship. The frequent outages in VPNs make accessing these platforms difficult.
The restrictions on Instagram and internet access in Iran have had broad implications for businesses and individuals, affecting market dynamics and profitability across various industries, including e-commerce and local businesses.
These internet restrictions also have serious consequences for disabled individuals. About 10% of Iran’s population, estimated to be around eight million people, are disabled, with 3% having severe or very severe disabilities.
Asghar Shirzadi, CEO of Iran’s Association of Disabled Persons, states that over 50% of the disabled population in Iran, equating to 8 to 10 million people, is unemployed. This emphasizes the difficulties they encounter in seeking employment opportunities.
Online businesses provide a significant opportunity for disabled individuals to find work and achieve financial independence. Platforms like Instagram and WhatsApp have been crucial for some disabled individuals to earn a living. However, the regime’s restrictions and filtering have impacted their ability to work on these platforms, exacerbating poverty within the disabled community.
Even before the enforcement of restrictions and filtering, disabled individuals already faced challenges in securing employment. The absence of necessary infrastructure and financial limitations make it difficult for them to afford even the basic equipment required for work.
