After reportedly charging $2 million per ship and threatening to cut undersea cables, Iran wants to turn the Strait of Hormuz into a digital toll booth. According to a report, media outlets linked to the Islamic Revolutionary Guard Corps (IRGC) are calling for the government to generate revenue from the massive network of undersea internet cables that pass through the strategic waterway.According to a report by Tasnim news agency (via Iran International), Iranian officials are framing the Strait of Hormuz as a “hidden highway” that carries more than $10 trillion in financial transactions every single day. And they are said to be planning a three-step plan to charge for the undersea cables.
Three-step plan for ‘digital power’
State-linked outlets Tasnim and Fars have reportedly outlined a specific strategy to monetise these vital communications lines, which carry over 99% of international internet traffic. The proposed plan includes charging foreign tech giants initial and annual “transit taxes” or “tolls” for cables passing through the strait.The report also said that Iran may also require major tech companies like Meta, Amazon and Microsoft to operate under Iranian law if their data passes through the region. Thirdly, the tech companies may have to give Iranian companies total control over the repair and maintenance of these cables.Fars described the cables as the “backbone” of global technology, claiming that even a few days of disruption could cause hundreds of millions of dollars in economic damage.
What this may mean for global Internet users
If Iran moves forward with these “digital tolls,” the impact could ripple across the globe. If Iran starts charging “toll”, companies like Google, Meta, and Microsoft may pass these new operational costs down to consumers through pricier subscriptions for services like Google One or Microsoft 365.If the Strait of Hormuz becomes too expensive or legally risky, tech companies may have to reroute data through longer paths, essentially increasing “latency”, leading to lag in online gaming and slower 4K streaming.By forcing tech companies to operate under local laws, user data passing through these cables may potentially become subject to local surveillance or data-sharing regulations.The report also says that Iran argues that it has the legal right to exercise sovereignty over these cables because they pass through its territorial waters. By implementing these measures, the IRGC aims to turn the Strait of Hormuz into a “strategic center for wealth creation” and a powerful lever for “digital power” on the world stage.
