The Iranian government has announced that it intends to impose tolls on undersea internet cables in the Strait of Hormuz. Media sources report that tech giants such as Google, Microsoft, Meta, and Amazon are being required to comply with Iranian regulations. Refusal could result in disruptions to the cables that carry the vast majority of global internet traffic.
Last week, Iran’s military spokesperson Ebrahim Zolfaghari announced on X: “We will impose fees on internet cables.” Iran’s position in the global network makes this an acute risk. Several crucial fiber-optic cables run through the Strait of Hormuz, including the AAE-1, FALCON, and Gulf Bridge International (GBI). These systems connect Europe, Asia, and the Middle East and carry data traffic for everything from cloud platforms to financial transactions and AI infrastructure.
With these threats, Tehran aims to deploy a new leverage tool alongside the already familiar oil threat. Media outlets that regularly echo the Revolutionary Guard’s talking points assert that cable maintenance and repair are the exclusive domain of Iranian companies.
We regularly report on the growing threat posed by countries such as Russia and China to undersea cable infrastructure; Iran now joins that list, but clearly in a different way than we have seen before. Particularly regarding Russia, there was and remains a fear that a container ship or other vessel might sabotage a cable. With Iran, the cable remains intact, but a tariff wall suddenly applies to countless transactions.
Hormuz as a digital bottleneck
There is no doubt that the Strait of Hormuz is vulnerable. Although operators have shifted routes as much as possible toward the Omani side due to concerns regarding Iran, the FALCON and GBI cables still run through Iranian territorial waters. This is reported by telecom research firm TeleGeography. According to analysts, the Revolutionary Guard has combat divers, mini-submarines, and underwater drones with which Iran can threaten the infrastructure.
A disruption to the cables could have far-reaching consequences. Banking systems, stock exchanges, cloud services, and communication networks across multiple continents are at risk. The Netherlands and Belgium are among many countries also investing in better security for their undersea cable connections, a response to similar threats in the North Sea.
Precedent in the Red Sea
The fear is therefore real, Gulf News also notes. In 2024, three undersea cables in the Red Sea were cut after a ship, struck by Iran-aligned Houthi militants, dragged its anchor across the seabed. That incident disrupted nearly 25 percent of internet traffic in the region. The AAE-1, EIG, and SEACOM were involved in that incident —three systems with extensive coverage between Asia and Europe.
Iranian media compare the toll plans to the Suez Canal, where Egypt generates revenue from shipping and cable traffic. Legal experts reject that comparison, according to Gulf News. The Strait of Hormuz is an international strait and is subject to different provisions of the UN Convention on the Law of the Sea (UNCLOS) than the Suez Canal, which is fully controlled by Egypt. It remains unclear how Iran could enforce these demands under heavy U.S. sanctions.