I don't know if it's completely true that English has less character variation than Arabic— as you say, in English there is a choice of upper or lower-case, with occasional changes in meaning. In Arabic, the form of a letter is completely determined by the letter it follows. It's purely a display difference, not a separate character set. There are the diacritics to think about, but outside of the Quran they are simply ignored.
That's still a big problem for a universal language of the internet though, since written Arabic is highly non-phonetic.
That's still a big problem for a universal language of the internet though, since written Arabic is highly non-phonetic.