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analysis President Bill Clinton's 1997 electronic embargo against Iran, which curbed its citizens' access to U.S.-based software and Web sites, continues to create legal hassles for American Web companies.

In August 1997, Clinton signed an executive order saying U.S. companies and individuals could not provide "goods, technology, or services to Iran" -- a decree that led to unintended consequences such as Utah-based Bluehost giving the boot to Iranian bloggers and opensource software site SourceForge.net denying access to Iranians.

The U.S. Department of the Treasury's announcement yesterday, which was designed to complement President Obama's statement marking the Iranian New Year and comes as advocates of war against Iran are redoubling their efforts, may not be that much help.

Treasury says these forms of "services and software" can be made available to Iran:

Personal Communications (e.g., Yahoo Messenger, Google Talk, Microsoft Live, Skype (non-fee based))

Updates to Personal Communications Software

Personal Data Storage (e.g., Dropbox)

Browsers/Updates (e.g., Google Chrome, Firefox, Internet Explorer)

Plug-ins (e.g., Flashplayer, Shockwave, Java)

Document Readers (e.g., Acrobat Readers)

Free Mobile Apps Related to Personal Communications

RSS Feed Readers and Aggregators (e.g., Google Feed Burner).

But Treasury spokesman John Sullivan downplayed the significance of yesterday's news. The "announcement was a clarification of existing guidance," Sullivan told CNET in e-mail. "It did not change the guidelines."

The problem is that the existing guidelines -- last liberalized in March 2010 -- are still pretty restrictive.

One example: even after that modest liberalization, Google restricts Iranians' access to the Android Market, now called Google Play. In response to a question at the Mobile World Congress in Barcelona last month, Google executive chairman Eric Schmidt blamed Treasury regulations.

"I'm with you," Schmidt said. "But prison--there's no bandwidth."

After the 2010 liberalization, Google did announce that "we're making Google Earth, Picasa, and Chrome available for download in Iran." (A Google representative declined to elaborate when contacted by CNET.)

But Iranian Internet users remain, understandably, peeved that the other restrictions imposed by the U.S. Treasury's Office of Foreign Assets Control, or OFAC, continue to exist.

They've started a petition saying they're denied access to the Android Market, among other products. We "do not have the slightest interest in the governments' political stances," the petition says. "We just want to be able to use the software like any other person in the world."

The irony: Clinton's anti-Iran order in the 1990s presumably was never meant to restrict access to security software and Web sites that can aid Iranian activists agitating for a freer society. Yet it does. A 2010 article in Foreign Affairs called the current rules "grossly outdated." (A newer set of U.S. sanctions against Iran, restricting financial transactions, is also causing unintended consequences for everyone from drug maker Merck to a Redmond, Wa.-based diaper maker.)

Collin Anderson, an independent researcher in North Dakota who focuses on Internet filtering and censorship in the Middle East, has compiled a list of U.S.-based technology products that remain unavailable to Iranians. Among them: Apple's iOS app store, McAfee's antivirus software, Oracle's Java and MySQL, Adobe's Acrobat Reader, DropBox, Real Player, Google AdWords, and Google Android Market.

After yesterday's list from OFAC that mentions some of those products by name, the list of off-limits apps is likely to shrink. But Anderson notes that OFAC has not authorized some very useful products and services including antivirus applications, privacy-protective VPNs, the ability to buy domain names and SSL certificates, satellite connectivity, and phone or other mobile hardware. VPNs would be especially useful in a country like Iran, which has demonstrated an extraordinary willingness to conduct surveillance of its citizens.

"There are allowances on food and medical supplies that could be modeled for hardware or others, but the executive agencies have been quite evidently afraid of members of Congress like Mark Kirk," Anderson says. Sen. Mark Kirk, an Illinois Republican who holds President Obama's old seat, has been leading the charge to cripple Iran's economy on suspicions it's developing nuclear weapons.

Another limitation is that other countries may not benefit; even though the Treasury Department's OFAC may be edging toward a more liberal approach, Commerce Department regulations still target democracy activists in Syria, where a near-civil war continues. Similarly, downloads of Google Earth are banned for Sudan.

"Restrictions from the Department of Commerce's Bureau of Industry and Security still appear to prevent communications tools and services from being exported to Syrians without a license," Electronic Frontier Foundation attorneys Cindy Cohn and Jillian York write in an essay. "Because of these restrictions, Syrians still cannot access Google products Chrome and Earth, cannot download Java, among various other tools, and cannot use hosting services like Rackspace, SuperGreenHosting and others."

The unintended consequences of these electronic sanctions aren't exactly new. In 2003, OFAC sent Monster.com legal guidance that caused it to censor resumes from its users that mentioned Iran, Syria, Sudan, Myanmar, Cuba, and Libya. Back in 1996, citing the Iran and Libya Sanctions Act, a U.S. government official quietly pulled the plug on Iran's Internet connection.

In theory, neither Treasury's OFAC nor Commerce's BIS probably have the authority to interfere with Web communications. The so-called 1988 Berman Amendment to federal law stripped the president of his authority to "directly or indirectly" regulate the export of "information and informational materials."

But in reality, bureaucrats aren't known to relinquish power readily. And while President Obama has been willing to record YouTube videos on the free flow of information, he has yet to reverse his predecessor's decision. Which means that Clinton's 1997 embargo, which claimed Iran posed an "unusual and extraordinary threat to the national security, foreign policy, and economy of the United States," has forced Iranians and Syrians to remain second-class Internet citizens.

Update March 22 at 9:40 a.m. PT: I received e-mail from Treasury's John Sullivan elaborating on his earlier response, which he said was brief because he was traveling in the Middle East. Sullivan's elaboration this morning, referring to this week's OFAC announcement, said: "It was a significant step that was in line with the president's message and clarified the guidance for companies exporting information technology to Iran which is quite important as some companies were reluctant to do so in the past."