Iran Now Threatens Fees for Subsea Internet Cables in the Strait of Hormuz

Source: Slashdot

Background

Iran’s government is reportedly seeking to charge the world’s largest tech companies for using the subsea internet cables that run under the Strait of Hormuz. State‑linked media have hinted that traffic could be disrupted if firms do not pay.

Lawmakers in Tehran discussed a plan last week that could target submarine cables linking Arab countries to Europe and Asia. Iranian military spokesperson Ebrahim Zolfaghari announced on X that “we will impose fees on internet cables.”

Proposed Fees on Subsea Cables

The plan, linked to the Revolutionary Guards, would require companies such as Google, Microsoft, Meta, and Amazon to comply with Iranian law. Submarine‑cable operators would have to pay licensing fees for cable passage, and repair and maintenance rights would be granted exclusively to Iranian firms.

It is unclear whether the cables in question actually traverse Iranian waters, and how Iran could enforce payment given that U.S. sanctions prohibit these companies from making payments to Iran. Consequently, many view the statements as posturing rather than a concrete policy shift.

Potential Impact

Subsea cables carry vast amounts of internet and financial traffic between Europe, Asia, and the Persian Gulf. Targeting them could affect far more than internet speeds, threatening:

• Banking systems and financial trading
• Military communications
• AI cloud infrastructure
• Remote work, online gaming, and streaming services

Disruption could cascade across several continents, creating a “digital catastrophe.” Iran’s neighbors around the Persian Gulf might experience severe internet outages, jeopardising critical oil and gas exports and banking operations.

Beyond the region, India could see a large share of its internet traffic affected, endangering its outsourcing industry and potentially causing billions in losses. Financial trading and cross‑border transactions between Europe and Asia could slow, while parts of East Africa might face internet blackouts. If similar tactics were employed in the Red Sea, the damage could be even greater.

Expert Commentary

Dina Esfandiary, Middle East lead at Bloomberg Economics, said the threats are part of a strategy to demonstrate Iran’s leverage over the Strait of Hormuz and to ensure regime survival. “It aims to impose such a hefty cost on the global economy that no‑one will dare attack Iran again,” she explained.

Mostafa Ahmed, senior researcher at the UAE‑based Habtoor Research Center, warned that the Islamic Revolutionary Guard Corps (IRGC) possesses combat divers, small submarines, and underwater drones capable of attacking underwater cables. He noted that any such attack could trigger cascading digital failures across multiple continents.