Overview

Figure 1. IT Revenue in Germany

Source: Adapted from “ITK-Marktzahlen,” by Bitkom; ITK-Märkte, EITO, 2022

*in billion USD, transformed from EUR to USD according to the exchange rate as of 05/15/2022 (1EUR=1.04USD)

Germany has one of the largest ICT markets in the world and the single largest software market in Europe with 95,808 IT companies (software and hardware, as of 2019, source: Statista) and an estimate of 1,124 million employees in 2022. There is strong demand for U.S. products and services across all segments. Key players such as Microsoft, Apple, Dell, Adobe, IBM, Oracle, and SAP have large market shares. There are also many highly specialized SMEs in the market. In 2022 revenue in the different IT subsectors consisted of USD 45.3 billion in IT-Services, USD 34.9 billion in IT-Hardware and USD 34.1 billion in the software subsector. Since 2007, total revenue in the IT sector has increased from USD 76.4 billion to an estimated USD 114.3 billion in 2021. Over recent years, a pattern of continuous growth is visible. Measured in EUR, total revenue is expected to amount to 108.6 billion EUR in 2022, compared to 102.6 billion EUR in 2021.

Germany hosts several key ICT trade shows, making it a premier marketplace for U.S. companies to reach global partners and buyers. U.S. exhibitors have frequently found buyers from Europe, Middle East, Africa, Asia and Latin America at the Hannover Messe, IFA Berlin, IT-SA, Gamescom or Embedded World. 

Policy Objectives and Challenges

ICT is a priority sector for the German government. Germany’s economic and innovation policy is outlined in the Digital Agenda of the BMWK (Federal Ministry for Economic Affairs and Climate Action). It focuses on digital infrastructure, digital economy, digital workplaces, innovative public administration, digital environments in society, education, research, science, culture and media, security, protection and confidence for society and business.

Policy objectives include cybersecurity, the digitization of the German economy and the expansion of the German broadband network. Challenges include the impact of the EU Digital Single Market, the General Data Protection Regulation (GDPR), the E-privacy Regulation on ICT companies, and the latest cybersecurity policy developments.

The U.S. Commercial Service follows these developments and continues to work with associations and multipliers such as BMWK, Bitkom (Association for Information Technology), BDI (Federation of German Industries), GTAI (Germany Trade and Investment) and AmCham (American Chamber of Commerce) to unearth opportunities and flag policy concerns.

Leading Sub-Sectors

Key segments and topics of interest include cybersecurity, internet of things (IoT), big data, health IT, cloud computing, business IT: ERP, data centers, smart social business platforms, integrated systems, virtual & augmented reality, and digital factory. 

Opportunities

• IT Security is the 2nd largest in Europe and has had strong growth 
• Health IT has experienced strong growth in recent years; experts expect a consolidation process and fundamental changes in the next couple of years
• The Artificial Intelligence market is expected to grow significantly
• Smart Social Business Platforms
• Big Data, such as hardware, infrastructure, services, database and analytics technologies, are all key drivers for a fast digitalization of the German economy
• Enterprise Resource Planning (industry-specific ERP solutions)

Trade Events

• Hannover Messe – Industrial: “Largest industrial trade show in the world. Of interest for U.S. producers of industrial IT solutions”, Hannover, April 17 - 21, 2023
• Embedded World – Embedded systems, Nuremberg, March 14-16, 2023
• Gamescom – Interactive games and entertainment, Cologne, likely summer 2023 (last iteration took place August 24-28, 2022)
• IFA Berlin – Consumer electronics and home appliances, Berlin, September 2-6, 2022
• it-sa – IT security: Cloud, mobile & cyber security, data & network security, Nuremberg, October 25-27, 2022
• ISE-Europe – AV and integrated system, Barcelona, January 31 - February 3, 2023
• AngaCom – Telecommunications, broadband & media, Cologne, May 23-25, 2023

Trade Associations

Bitkom, Federal Association for Information Technology, Telecommunication and New Media 

Bitmi, Federal Association for Medium-Sized IT Businesses

Teletrust, IT Security Association Germany

ECO, Association of the Internet Industry

NIFIS, National Initiative for Information- and Internet-Security

German Games Industry Association, Organization that represents the German computer and video games industry

VATM, Association of Telecommunication and Value-Added Service Providers

Government Entities

Federal Office for Information Security, National cyber security authority in Germany

Federal Network Agency, Ensures compliance with the Telecommunications Act (TKG), Postal Act (PostG) and Energy Act (EnWG) and their respective ordinances.