Telecoms & IT

A New Spark

IT sector opening up?

A potential opening up of the IT sector to foreign investment could see the sector grow in new directions in the coming years.

The 2012 sanctions imposed upon the Iranian economy led to stagnation in multiple sectors, but somewhat paradoxically contributed to an explosion of growth in Iran’s technology sector. New technologies still arrived, but the sanctions prohibited major western firms from profiting off the market, effectively creating a vacuum waiting to be filled by creative Iranian firms. As a result, the past few years have seen a wave of digital innovation as young, technologically active Iranians have developed the domestic industry free of interference or competition from the firms that have attained platform monopolies in the rest of the world. With the sanctions lifted, the rest of the world is now looking to invest in what has become a booming market. At the same time, the Iranian government’s efforts to privatize what has previously been state-owned telecoms markets should provide another avenue for investment and new competition. All told, the Iranian technology sector holds considerable promise for the years ahead.

The nature of the technology sector allowed it to handle the sanctions with more ease than other industries, which relied on the import of physical goods from the West. In a globalized world, it is impossible to fully prevent the transfer of information, and Iran was still able to remain up to date on new technologies. Thanks to a strong university system—more than 2 million Iranians are studying in STEM fields—the sector has no shortage of human capital, giving it a steady stream of talented, young professionals working to solve pressing problems. As a result of all this, the country saw a rise in domestic tech startups as young entrepreneurs took inspiration from Western startups to fill gaps in the Iranian economy with technological applications and platforms uniquely tailored to the Iranian population. Homegrown analogues to Uber and Amazon are just two examples of apps that have become popular, and the size of the Iranian economy has industry participants eager to continue to tap into the nation’s potential—with a population of nearly 80 million, Iran is considered one of the most appealing underdeveloped markets in both the region and the world.

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