Iran's Monthslong Internet Shutdown Is Crushing Businesses in an Already Battered Economy

The Iranian government's decision to maintain an extensive, nationwide internet shutdown throughout much of 2026 is inflicting severe damage on the country's burgeoning digital economy. Businesses, from fashion designers like Amen Khademi to retailers and advertisers, report a complete evaporation of income as their primary link to customers—the internet—has been severed.

Despite a fragile détente with the United States and Israel, Iranian authorities have refused to lift the restrictions, framing the shutdown as essential for national security during wartime. This stance, however, is met with growing domestic criticism, as it compounds the existing economic pressures from international sanctions and internal industrial disruptions. While workarounds exist, their prohibitive cost places them out of reach for the majority of Iran's 90 million citizens.

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The internet outage in the past four months has completely destroyed not only my business, but many online businesses.

The economic toll is staggering, with estimates suggesting daily losses of $30-40 million, and potentially double that in indirect damages. Approximately 10 million jobs are directly tied to internet connectivity, according to the communications minister. This deliberate reversion to a controlled national intranet, impacting a country with a previously developed digital economy, is unprecedented in its scale and severity, distinguishing it from more localized or platform-specific blocks seen elsewhere.

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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.