Report

Iran’s Ban of Messaging App Hurts Economy at Pivotal Moment

Rights group says app was widely used by businesses and even government offices.

People in Tehran check their mobile phones as they wait in the streets after an earthquake near Iranian capital on Dec. 21, 2017. (Atta Kenare/AFP/Getty Images)
People in Tehran check their mobile phones as they wait in the streets after an earthquake near Iranian capital on Dec. 21, 2017. (Atta Kenare/AFP/Getty Images)

Iran’s decision in April to outlaw the use of the encrypted messaging app Telegram, which shielded communications from the government’s prying eyes, has been a civil rights calamity for millions of Iranians.

But the ban has also had an unintended consequence: It’s been a drag on Iran’s economy just as the threat of renewed American sanctions looms, according to a new report by a nongovernmental human rights organization.

Before being banned, Telegram had 40 million users — about half the country’s population — including many businesspeople and bureaucrats. In Iran’s highly informal economy, banks advertised their services on the platform. Government functionaries used the app to pass documents between offices.

“Businesses small and big were using it as a way to communicate, advertise, and actually do deals,” said Hadi Ghaemi, the executive director of the New York-based Center for Human Rights in Iran, which issued the report.

“It’s the worst time to kill an engine of job creation and economic activity for regular Iranians,” Ghaemi said.

Given the fairly opaque nature of the Iranian economy, it’s difficult to assess the economic impact of the Telegram ban. But the report illustrates in interviews and data the many of ways in which Iranians relied on the easy-to-use messaging app to do business.

The group spoke to a 36-year-old named Zahra, who works for a private medical training company and said her firm used the application to organize classes training 4,000 doctors in Iran.

“We had a problem with older doctors who didn’t use the internet but when we started using Telegram, many of them signed up and began using it for information, registering for classes and sending receipts, which before was done by hand because they didn’t know how to email,” Zahra told researchers.

Another Iranian told researchers how the reliance on Telegram had extended into the offices of the very government that has banned it.

“We [used it to] send files, reports, letters and office communications,” said a 39-year-old government employee identified only as Ahmed. “With Telegram, email has become irrelevant.”

Iran has also banned other encrypted messaging services such as WhatsApp, WeChat, and Signal, as well as Western social media services such as Facebook and Twitter. It has encouraged its citizens to adopt domestically developed alternatives but has struggled to implement the ban.

Telegram was created by the Russian entrepreneur Pavel Durov but is now based in Dubai. Its encryption technology meant the government typically couldn’t access the content of users’ messages. Security officials in Tehran argued that the application had become a key organizing tool for anti-government protests.

Persistent unemployment, corruption, and deep inequality prompted a fresh wave of anti-government protests in January.

Tehran fears that a new round of U.S. sanctions following the Trump administration’s decision last month to pull out of the 2015 nuclear deal may further imperil the economy. In recent months, capital flight has cratered the Iranian rial relative to the dollar, and independent analysts believe inflation figures are far above the government’s official figure of 9.1 percent.

But Alireza Nader, an independent analyst on Iran said the ban could end up stoking rather than impeding protests.

“It’s just another blow to the economy,” said Nader, who is based in Washington. “It’s just going to get worse and worse, and unrest is going to increase. That’s the trajectory.”

Ahmed, the government employee, said some people are finding ways to circumvent the ban by installing virtual private networks or other tools on their computers — including on government networks.

“Sometimes the ministerial offices could not send letters because of problems with installing circumvention tools. Eventually, they had to be delivered by hand until one of our guys installed circumvention tools for the entire division,” he told the rights group.

Correction, June 21, 2018: Telegram’s encryption technology means the government typically could not access the content of users’ messages. Due to an editing error, an earlier version suggested it could access it.

Elias Groll is a staff writer at Foreign Policy covering cyberspace, its conflicts, and controversies. @eliasgroll

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