Rose Mojtahedzadeh, Vice Chair of the Iranian Virtual Businesses Association, told Asia News that the disruption of international internet access in Iran was far more than a communications outage; it triggered a severe crisis across the country's digital economy. According to her, the consequences extended beyond online businesses and platforms, affecting investment, software development, digital infrastructure, and even the future of the sector's workforce.

She emphasized that the impact should not be viewed as limited to platform-based businesses alone. “If we are to classify the crises caused by the internet shutdown, we must also consider its effects on equipment suppliers, software developers, investors, and many other segments of the digital economy,” she said.

Businesses Brought to a Standstill

Mojtahedzadeh described the immediate disruption to online businesses as the most visible consequence of the shutdown. Many entrepreneurs who had spent years building their businesses suddenly found themselves unable to continue operating. 

According to her, some companies were on the verge of securing investment or expanding their operations when the shutdown occurred, forcing their activities to halt and leaving founders uncertain about the future of their businesses. Many endured prolonged periods without being able to operate, suffering substantial financial and operational losses.

Three Categories of Online Businesses

She classified online businesses into three groups.

The first group consisted of large digital platforms, which, owing to stronger institutional support and broader service networks, were able to resume operations more quickly and experienced comparatively fewer disruptions. 

The second group comprised medium-sized businesses. Some had already established connections to Iran’s national internet infrastructure before the crisis, enabling them to continue operating to some extent. During the 12-day war, many companies applied for access to the national network, and some obtained it. However, after the conflict ended, the process was suspended, and many businesses stopped pursuing access, assuming 

normal conditions would soon return.

As a result, while some medium-sized firms managed to maintain operations, many others continued to face significant challenges.

Small Businesses Suffered the Greatest Damage

Mojtahedzadeh said small businesses were the hardest hit. Many owners abandoned their online operations altogether and returned to traditional business models, particularly in smaller cities and provincial areas. 

Despite years of investment, many entrepreneurs concluded that continuing online operations was no longer viable. She added that only a limited number of medium-sized businesses successfully adapted to the new environment, while many others effectively ceased to exist. 

No Reliable Estimate of the Damage

Regarding the financial losses, Mojtahedzadeh argued that existing estimates of the decline in digital business activity are not sufficiently evidence-based. Producing reliable figures requires long-term monitoring and systematic market research, which, in her view, has not yet been conducted. She stressed that measuring the digital economy involves more than counting newly established businesses. It also requires assessing how many skilled professionals have entered the sector, how many software developers have remained active, and how many have abandoned their careers midway. Such data, she said, have not been collected systematically.

Higher Equipment Costs and Fewer New Entrants

She also pointed to rising information technology equipment costs caused by exchange-rate volatility, saying these increases have made it significantly more difficult for young people to enter the technology sector.

A young person who could previously begin a programming career with an affordable laptop may now be unable to enter the profession because of rising costs. She described this as one of the indirect consequences of the crisis that has received little attention in official assessments.

Heavy Dependence on International Internet

Mojtahedzadeh noted that much of Iran’s digital economy continues to rely on international internet connectivity. Should another widespread shutdown occur, many businesses would once again face serious operational disruptions.

Reflecting on the recent conflict, she said that even after international internet access was restored, some companies that had requested connectivity were still waiting for approval. The fact that their websites resumed functioning only after international access returned demonstrated that no effective alternative had been available.

She added that it remains unclear why some companies received access while others did not. Nevertheless, a large number of businesses remain dependent on international connectivity and would likely face similar difficulties in any future disruption.

She also highlighted a few positive developments. Some companies seeking export opportunities have begun investing in Gulf countries, including Oman, creating potential new avenues for growth. In addition, growing concerns over cyberattacks have prompted businesses to strengthen cybersecurity measures, increasing demand for cybersecurity services.

Sharp Decline in Investment Appetite Responding to a question about investment, Mojtahedzadeh said domestic venture capital investors have become significantly more cautious. Many investment firms had initiated early-stage funding processes before the crisis, but the war and its aftermath prompted them to suspend or cancel planned investments in digital businesses, reflecting a sharp decline in investor confidence across the sector.