Information and communications technology market in Germany

Germany has developed one of the largest information and communication technology (ICT) markets in the world, positioning itself as the primary provider of software and the second largest cybersecurity market in Europe.

The country’s ICT industry is highly competitive and innovation-driven, mainly consisting of very specialized SMEs, but also including large players like SAP software solutions and T-Systems.

Germany is a major international financial center and the leading financial location in continental Europe. In light of the pandemic, the country has increased its efforts in digitalization, but still lags behind other countries and lacks a qualified workforce.

Key opportunities for Canadian ICT companies in Germany

  • Cutting-edge and niche products & services that leverage emerging technologies like:
    • Artificial intelligence (AI)/machine learning (ML)
    • Metaverse/Web3.0
    • Distributed ledger technology (DLT)/Blockchain
    • Quantum
    • Cloud computing
    • 5G
    • Certification authentication and verification (CAV)
  • Industry-specific software and services that  shape changes in production process and value chains
  • Intelligent process automation, preventive and predictive maintenance, Open API, low code app platforms, zero trust
  • FinTech, (Holistic) IT security, Health IT, RetailTech
  • Importance of IT hardware (shortage of chips/ semiconductors)

Notable challenges for Canadian ICT companies in Germany

  • Regulatory compliance (GDPR)
  • Security concerns
  • Privacy concerns
  • Reluctance to accept new technologies
  • Consumer preference for “Made in Germany” solutions

Germany’s business landscape

Industry highlights

274 billion CAD turnover of Germany’s ICT sector (2022)

90,887 ICT companies in Germany (2020)

5.4% ICT sector contribution to Germany’s industrial GVA (2021)

8 billion and 45.4 billion CAD total value of German IT hardware and IT-services exports (2022/ 2021)

5.6% of Germany’s ICT sector’s turnover spent on R&D (2020)

$72.3 billion and 66.7 billion CAD telecommunications and IT services: segments with highest turnovers (2022)

1,091,200 Germany’s ICT sector workforce (2021)

9.4% software: segment with highest growth rate (2022)

Germany is making ongoing efforts in digitalization, and various industries are experiencing a related push to scout for new technologies, including Germany’s large and conservative banks.

The country’s 5G roll-out and high expenditure on innovation, as well as  increased interconnectedness between infrastructures and ICT, represent great opportunities for highly competitive Canadian companies to enter the market through a mutual tech project or Proof of Concept, or to raise VC in a variety of ICT sub-sectors.

Summary

For its size, competitiveness, interest in emerging technologies and high focus on innovation, alongside a continued push towards digitalization and the country’s lack of qualified workforce, Germany is a very attractive target market for Canadian companies.=

Moreover, attending or exhibiting at one of Germany’s major trade shows, like Hannover Trade Show, embedded world or a smaller, but very focused show like it-sa expo, offers fantastic exposure to the German and many other international target markets.

For more information on ICT in the German market, please contact deutschland.commerce@international.gc.ca.

Additional Information

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