Hungary Country Commercial Guide
Learn about the market conditions, opportunities, regulations, and business conditions in hungary, prepared by at U.S. Embassies worldwide by Commerce Department, State Department and other U.S. agencies’ professionals
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Information and Communication Technology
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Overview 

The Hungarian information and communication technology (ICT) sector’s official gross value added in 2024 was USD 11 billion while with the broader digital sectors, the ICT market size is estimated to be between USD 32-35 billion in 2025, reflecting rapid growth and strong digital transformation across public and private sectors. The ICT sector accounts for around 6-7% of Hungary’s GDP, driven by telecommunications, IT services, and software development, with large enterprises and SMEs both contributing significantly to market expansion. This sector employs over 112,000 professionals and benefits from active government support and a significant government focus.  Software development in Hungary contributes significantly to the country’s economy. Hungary also has a large share of outsourcing within the region, with 80,100 specialists employed in the IT sector. IT-friendly policies such as financial support for R&D have helped the country attract several multinational companies such as Siemens, Microsoft, Deloitte, Ericsson, Nokia, and TATA to establish R&D centers in the country.

The Hungarian ICT industry’s growth is fueled by several factors, primarily the government’s consistent support for digitalization, increasing investments in advanced technologies by both private and public entities, and the expanding demand for digital solutions across all industry sectors. Furthermore, the ongoing modernization of the telecommunications infrastructure and the rising adoption of cloud computing, AI, and IoT are significantly contributing to the sector’s expansion.

Hungary has an adopted national Artificial Intelligence strategy covering the period 2020-2030, with an updated regulatory framework introduced in 2025 aligned with the EU AI Act. The strategy focuses on building a safe, transparent, and innovative AI ecosystem across society, business, and technology. It emphasizes strengthening data infrastructure, research and development, AI uptake in SMEs, and collaborative networks, with priorities in sectors such as manufacturing, healthcare, agriculture, and public administration. The government also plans to establish an AI regulatory authority and a national AI council to oversee AI governance and market surveillance.  The strategy is regularly reviewed to keep pace with AI advancements and support Hungary’s competitive positioning in AI innovation.

ICT in Hungary is overseen mainly by the Ministry for National Economy (economic aspects, AI, and innovation), the Ministry of Culture and Innovation (education, competencies, technological implementation), and the Cabinet Office of the Prime Minister (strategy, broadband, e-government), with the KIFÜ agency (Governmental Information Technology Development Agency) under the Ministry of Culture and Innovation handling public sector ICT projects. IT public procurement planning of the various government agencies, ministries and state-owned enterprises is centralized through the Digital Government Agency (DKÜ) for the procurement of IT services and solutions.  

Market consolidation is underway in the ICT sector, led by Hungarian tech company 4iG’s aggressive acquisition strategy. This is expected to disrupt the Hungarian ICT market in the near-term as the company’s assets cross most lines of business, from satellite communications through IT services to space and defense technologies and it aims to position itself as the largest end-to-end solutions provider in the B2B segment. The company has three key pillars – IT Systems, Telecoms & Infrastructure and Space & Defense – motivating its portfolio expansions in the region.  4iG, in partnership with the Hungarian government, completed the acquisition of Vodafone Hungary in January 2023. It has recently rebranded its asset portfolio under the One banner and integrated Vodafone Hungary to gain scale in convergent services.

The mobile telecommunications market has 11.3 million active subscriptions. This number includes both consumer and business accounts, reflecting dual SIM usage and multiple subscriptions per person, which is typical in mature markets like Hungary. Operators are trying to maximize their revenues from selling premium services and high-speed data packages to existing clients and business customers.  

5G coverage in Hungary is 85.6% (2030 national target: 99%). The 5G strategy based on the proposals of the 5G Coalition (5GC), has been formally adopted by the Hungarian government.  It aims to make Hungary a major European center for 5G development.  It should also take the leading role in the region in testing 5G applications. The multi-band award process took place as an auction in March 2020. The mobile sector’s three major players won licenses.  These include Yettel (formerly Telenor, controlled by PPF Group), One (created from the merger of Vodafone Hungary and Digi, owned by 4iG and the state) and Magyar Telekom (the successor of the former monopoly telecommunications firm, now majority owned by Deutsche Telekom). The licenses involved 700 MHz, 3400-3800 MHz bands and the remaining spectrum in the 2100 MHz and 2600 MHz bands. The three operators continue to deploy 5G sites, but they follow different strategies on the use of the 3.6 GHz, the 700-800 MHz and 1.8-2.1 GHz bands.  

In terms of market share, as of 2025 Magyar Telekom had a 45% market share with 5 million subscribers, Yettel held 28-30% with 3.7 million subscribers, One controlled 28% with 3.5 million subscribers.  Immediately after winning the license, Magyar Telekom launched commercial 5G services together with Ericsson. Vodafone (now One) launched services in October 2019, in partnership with Huawei. The third operator, Yettel, was the first operator to launch a 5G home internet service in May 2022. Nokia and Ericsson are the main equipment providers for Yettel’s network modernization in Hungary, facilitated through CETIN Hungary, its network infrastructure partner, with additional infrastructure investments continuing through 2028.

Hungary has a long history as an important electronics production center in Europe, and the industry made an important contribution to domestic economic development through employment, value-add and export earnings. There has, however, been a relative decline in the consumer electronics industry as supply chains became more geographically concentrated, for instance with smartphone manufacturing in China and Vietnam. There is a trend for non-ICT electronics investment and production, for instance with the large investments flowing into the battery supply chain related to the electrification of the automotive sector and grid modernization associated with renewables. 

Although battery manufacturing has become the main investment theme and focus of industrial policy in Hungary’s electronics sector, there continued to be investment in some areas of ICT electronics. Major investments in alternative energy solutions to reduce dependence on Russian gas will generate demand for electronics components in supply systems and energy storage and potentially lay the foundation for a period of energy abundance that could create new opportunities and use cases for electronics products.

Driving forces propelling the Hungary ICT market include increased government investment in digital infrastructure; growing adoption of cloud computing and digital transformation initiatives; rising demand for cybersecurity solutions; expansion of high-speed internet access and 5G network rollout; and the increasing penetration of smart devices and the rising adoption of IoT solutions. The most significant emerging trends in Hungary are the increased adoption of AI and machine learning, the growing use of big data analytics, the expansion of the Internet of Things (IoT), the rise of edge computing and the focus on sustainable and green ICT solutions.

Opportunities

The mid-term outlook is positive as the pandemic accelerated the momentum for digital transformation and cloud adoption in the private and public sector. Opportunities exist in the rising adoption of cloud computing, big data analytics, artificial intelligence (AI), the expansion of 5G networks and the growing need for cybersecurity solutions. There could also be significant opportunities derived from the EU recovery investment strategy, which has a major digital element. Hungary allocates 29% of its total Recovery and Resilience plan to advancing the country’s digital transformation, i.e. EUR 1.7 billion (USD 1.9 billion). In addition, under cohesion policy, EUR 2.6 billion (USD 3 billion), representing 12% of the country’s total cohesion policy funding, is dedicated to the same purpose.

Sectors of relative weaknesses, including transportation, banking and healthcare represent opportunities in terms of future IT-related growth, especially for software. Hungarian IT spending is expected to grow, driven mainly by an increase in public sector spending, which reflects three major drivers: digital transformation including investment in future technologies, such as Internet of Things in manufacturing, retail, utilities, agriculture, logistics and AI, particularly in customer service and customer-facing deployment;  NIS2 and GDPR-related backlog for regulatory compliance being a key driver in the Hungarian IT services market and continued investment in systems and processes is still required to catch up with best practice; public-sector investment to increase efficiency and reduce overheads.

  • The hardware segment was forecast to be broadly flat through 2025, with systems integration growing at a rate of 2% and software at close to 7%. Bearing these differing growth rates in mind, the Hungarian market offers opportunities in high-demand new technologies including digitalization, deep learning, artificial intelligence, Industry 4.0, cyber security and fintech. 
     
  • Systems integration and application development represent approximately a quarter of the market, while the public, finance, telecommunications, and manufacturing sectors make up around two-thirds of market revenues. The fastest growing segment of the system integration market is outsourced services creating market opportunities for global IT integration companies, most of which are not yet present on the market, such as Accenture, Cap Gemini, Citrix, etc.  
     
  • For semiconductor production, Hungary does not currently have a significant domestic industry. As a result, there is a growth in semiconductor and computer parts imports that serve as inputs for local assembly operations. There is a massive investment in semiconductors (both research and production).
     
  • Cloud adoption, expanding basic 5G coverage, increasing broadband connectivity, and driving digitalization in SMEs are all areas in which Hungary continued to make progress. The rapid growth in cloud adoption, digital transformation projects, and the increasing need for efficient and cost-effective IT solutions across various industry verticals are crucial factors for the dominance of the IT Services segment. Large enterprises with complex needs are the primary consumers, but SMEs are also rapidly adopting these services. Government investments in digital infrastructure further boost sector growth. Companies in the logistics and warehousing sector are the most likely to use cloud services, while agriculture and mining are the least likely. The most significant barriers to technology in Hungary are lack of skills, lack of understanding, security concerns, budgetary constraints, regulatory obstacles and contractual obligations. The AI investment boom in Europe will create some momentum for Hungary’s IT market, for instance in server and cloud hosting demand.
     
  • AI adoption in Hungarian enterprises is significantly below the EU average of 13.48%. SMEs had an AI uptake rate of 6.97%, whereas large enterprises had a higher rate of 23.46%.  While the adoption of AI technologies among Hungarian enterprises remains limited and difficult especially for SMEs, rising labor costs and labor shortages will strengthen the investment case for Hungarian firms looking at advanced automation. There are specific opportunities within the manufacturing sector, such as automotive manufacturing where there will not only be investment in IT to enhance production and bypass labor constraints but also an increase in the technological content of the cars being produced. Automotive groups with factories in Hungary include Suzuki, Audi, Mercedes-Benz and BMW.
     
  • In 5G rollout significant opportunities exist for U.S. exporters in Hungary, particularly in supplying products, solutions, and expertise in telecommunications hardware, network equipment, software services, security solutions, end-user devices where U.S. offerings demonstrate technical superiority or address emerging 5G use cases. Hungary’s development of 5G networks is creating demand in several specific areas such as IoT and industrial automation, AI-powered applications, digital infrastructure consulting, though competition from Chinese and European tech providers remains strong.
     
  • Broadband connectivity: In Hungary, fixed broadband take-up indicators are excellent, but the mobile ones are below the EU average. The number of fixed broadband subscribers is expected to rise from an estimated 3.6 million in 2024 to 3.9 million by 2029. Mobile broadband subscriptions will grow by an average of 1.4% per year.  Hungary is planning to use EU funding for broadband infrastructure deployment in rural regions. However, the EU continues to withhold €20bn (US$21bn) of funding amid disputes over the rule of law in the country. Opportunities exist in digital public services and in the integration of digital technologies in businesses, such as cloud computing and big data. The development of digital infrastructure has been a main pillar of the Hungarian Info-communication Strategy since 2014 but covering 95% of households by gigabit networks is one of the objectives in the new National Digitalization Strategy (NDS 2021-2030). 
     
  • Satellite communications: The launch and operation of the first Hungarian satellite, scheduled for 2024, will create sales opportunities for a wide range of products, services, and solutions ranging from the satellite itself to launch services. Hungary’s first commercial satellite will be suitable for broadcasting; internet and telephone services; data transmission; commercial, governmental, and scientific research missions. In addition to participation from Hungarian universities and researchers in the commercial satellite launch program, 4iG – a Hungarian IT company, holding a 51% controlling stake in the company “CarpathiaSat Zrt.”, which was formed with the goal to launch the satellite – aims to establish a strategic collaboration with domestic and international companies with significant experience in the space industry. 
    Smart city initiatives in Hungary, until now, were incentivized by collaborations of municipal and business players in this sector, often focusing on specific technical advancement. Hungary has yet to embark on a large scale and centralized smart cities undertaking as seen in many other Western European countries. U.S. exporters have substantial opportunities in Hungary’s smart city sector, especially in supplying technologies and solutions for urban infrastructure, transport, energy, and public services. Hungary’s drive for modern urban development, driven by government programs such as the Modern Cities Program and a national digitalization push, creates demand for innovative products and expertise from U.S. firms.
     
  • Smart mobility is one of the best prospects. Intelligent transportation systems are being installed in several cities. The development of such solutions has become a priority for local municipalities and includes radar, cameras, automatic scales, and advanced electronics for road transport. Hungary’s Modern Cities Program includes USD 133 million for public transportation and smart mobility development projects. The construction of a 5G trial zone by Magyar Telekom is in progress in Zalaegerszeg (western Hungary), aiming to embody autonomous operation, 5G development and all the other specific features of the smart city. The experimental 5G mobile communications network could be a good basis for Hungary in becoming one of the hubs for 5G development in Europe. 
     
  • Smart buildings and construction are other areas of focus. Both the public and private sectors are converting current buildings into smart buildings, including renewable energy sources, advanced access controls, and sophisticated security management among other innovations. Smart building technologies in high demand in Hungary include building management systems (BMS) for centralized control of HVAC, lighting, and security, energy efficiency solutions, IoT-based automation, and renewable energy integration. There is a growing interest in AI for predictive maintenance, digital twins for property modeling, and sensor-based property management for real-time data collection and optimization.
     
  • Cyber security: Hungary’s cyber security ranking has slightly deteriorated and has fallen to 35th place on the International Telecommunication Union’s Global Cybersecurity Index (GCI). This ranking places Hungary among the upper-middle group of EU member states in terms of national cybersecurity maturity and resilience. This ranking reflects the impact of Hungary’s new 2024 Cybersecurity Act, which came into effect on January 1, 2025, aligning national regulations with the EU’s NIS2 Directive (Security of Network and Information Systems) and consolidating cybersecurity oversight under unified national authorities. The Hungarian government has approved the National Cyber Security Strategy, which provides a framework for improved cybersecurity. Overall, Hungary’s regulatory landscape, compliance pressures, and technological modernization support significant market entry and partnership opportunities for U.S. cybersecurity exporters – across hardware, software, services, and training modules.

Resources 

 

U.S. Embassy - U.S. Commercial Service 
Eva Bosze, Commercial Specialist 
Budapest, Hungary 
Tel:  +36 (1) 475-4234 
Email: eva.bosze@trade.gov 

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