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Not only Hungary but all of Europe depends on American information technology, and this dependence has only deepened with the rise of artificial intelligence and cloud-based services. Although the European Union recognised the problem long ago, eliminating this reliance across the continent, as well as within the Hungarian government, public administration, and business sector, could take decades.

AUTHOR: Máté CSABAI

Does it matter which operating system runs on the computers of our government offices and hospitals, or whether government agencies and ministries use the email systems of Google or Microsoft? While the United States’ global leadership in IT, AI technologies, and data management is unquestionable, the European Union set itself the goal years ago of achieving its digital autonomy.

“Six years ago the European Commission, under the leadership of Ursula von der Leyen, committed itself to ensuring that we possess our own capabilities in key areas such as chip manufacturing, cloud technologies, and telecommunications infrastructure,” says Csaba Krasznay, associate professor at the University of Public Service. “The most recent amendment proposed to the Cybersecurity Act explicitly states that certain technologies could even be excluded from the European market for cybersecurity reasons.”

According to Krasznay, reducing technological dependence could take at least twenty years and enormous financial resources. The gap began to open in the 1990s, when Europe still had its own mobile-phone manufacturers and chip-production capacity. But while EU strategists left the expansion of internet technologies largely to the market, the United States under President Bill Clinton sought to use the internet and digital technology as instruments of economic and political hegemony. Although there exist European software companies, they cannot operate without American technology.

What about Hungary?

According to the expert’s estimate, Hungarian public administration depends on some form of American technology in 80–90 percent. This is evident already at the most basic hardware level: most processors used in computers and servers are designed by American companies such as Intel or AMD. And although Lenovo – the brand most frequently purchased through public procurement – is Chinese, it still runs American operating systems.

Most often this means Microsoft, which through its Office software suite determines what government officials and ministry work with. Replacing these systems would be a serious challenge, and there are few alternatives anyway. The only widely known open-source operating system developed through community efforts, Linux, plays only a marginal role. “Moreover, the state has agreements that provide access to these systems even for students in public education,” Krasznay notes.

The Digital Government Agency (Digitális Kormányzati Ügynökség, DKÜ) purchases Microsoft licenses through centralised framework agreements; the current contract runs until 2029 and includes not only the Windows operating system but also Office software, server products, and cloud services. Meanwhile, under the Tisztaszoftver Program, (Clean Software Program) which has been running since 2003 and is also administered by the agency, students and teachers use the company’s software on a massive scale. In practice, this embeds the Microsoft ecosystem in the public sector on a generational level. Hungarian students and teachers are largely socialised in a Microsoft environment.

At least the data stays in Europe?

“In Hungary, regulations that have existed for many years require that data generated within public administration be preserved and archived,” Krasznay explains, introducing the concept of “data sovereignty.” In 2013, an information-security law was adopted that strictly limited the transfer of administrative data abroad.

However, the 2024 cybersecurity law is more permissive regarding the foreign storage of data, since many modern IT services function only through cloud infrastructure. “There is only one reason for this: technological reality. Under current regulations, the data must physically remain within the territory of the European Union, but that does not mean it is not running on American technology,” Krasznay says.

In practice, this means the data may be physically located in Frankfurt or Amsterdam – in a data centre operated by Microsoft. It is worth noting that the 2018 US Cloud Act allows American authorities to request data from U.S. companies even if the data is stored on foreign servers – an argument often cited by European critics concerned about data sovereignty.

Hungary’s IT infrastructure, however, primarily relies on the Government Data Center facilities operated by the National Infocommunications Service Company (Nemzeti Infokommunikációs Solgáltató Zrt, NISZ), with appropriate physical oversight. The infrastructure managed by NISZ comprises several thousand virtual servers and many petabytes of data. Most government data centres are located in Budapest, while the planned government data-centre project in Göd, once announced as a key development, has been delayed for years and remains controversial.

The Government Cloud (KOF) operates under unified and regular auditing and is used by ministries, central government offices, national authorities, and other public administrative bodies; private companies cannot access it.

The NISZ data-centre and cloud infrastructure hosts central registries and digital public-administration services such as Ügyfélkapu, e-Papír, and other online administrative platforms, without which everyday life would simply stop in Hungary. Yet it is supported by a private cloud environment built on the technology of the California-based Oracle Corporation, as well as virtualisation technology based on VMware, the market leader now owned by Broadcom. The cloud connects to the National Telecommunications Backbone Network but operates separately from it. The government’s relatively new Digital Citizenship Program also runs on Oracle’s cloud services.

“This form of data sovereignty does provide data security, but it does not amount to true digital independence,” Krasznay says. He also notes that the contractual guarantees and compliance requirements offered by service providers exist on paper, but it remains unclear what would happen if, for some reason, they failed. “There has never yet been a case where the U.S. government exerted political or economic pressure on Hungary through the major tech companies and instructed a provider to terminate cooperation with the government.”

For decades, both the European Union and Hungary have maintained close cooperation with the United States, which forms the basis of trust in American technology. “That same level of trust does not yet exist toward China, even though the American and Chinese legal environments are not radically different,” Krasznay says.

He adds that while government data centres largely rely on American technology, facial-recognition technology increasingly used by the police is mostly Chinese. Despite the Hungarian government’s policy of opening toward China, there is no strong Chinese presence in the IT sector; it is more visible in telecommunications and industrial infrastructure.

Within the European Union, opinions are divided on whether diversification –sharing dependence between the United States and China – would be acceptable. “European policy tends to push Chinese technology out of certain critical sectors rather than allowing it in.”

Europe’s long road to digital sovereignty

The European Union’s Digital Decade program aims to increase European cloud capacity, strengthen “digital sovereignty,” and expand the continent’s own semiconductor manufacturing by 2030. Currently, Europe accounts for only about 9 percent of global semiconductor production.

Replacing American technology therefore appears almost utopian. Countries forced into technological self-reliance because of war or sanctions, such as Russia or Iran, have effectively moved 20 to 30 years backward technologically.

Most systems used in public administration remain Windows-based. The example of France, where some ministries have restricted the use of Microsoft Teams, remains an exception. Meanwhile, much of Europe’s infrastructure development, including the EU’s sovereign cloud initiative GAIA-X, is being built partly by American companies.

Since the early 2000s, the EU has repeatedly spoken of prioritising open-source technologies, but this has largely remained rhetoric. “Even if there were strong political will to introduce them, users would be the first to protest, because they are accustomed to a different level of service,” Krasznay says.

Krasznay does not see Hungary facing any unique problems in its technological dependence on the United States that are not shared by the rest of Europe. “We struggle with the same issues everywhere. If I walk into a graduating high-school class, out of thirty students at most two or three want to become engineers. A large proportion of them will end up abroad anyway, most often in the United States, where they will put their knowledge to use.”

Among the world’s top technical universities, only a handful are European. Yet without large numbers of engineers it is impossible to rebuild or create a competitive IT industry. The European Union currently spends only a fraction of what the United States or China invests in developing its technological sector. China, which has largely succeeded in catching up in information technology, managed to do so only by suppressing wages and accepting significant environmental costs. Europe cannot follow the same path.

The project is co-financed by the governments of Czechia, Hungary, Poland and Slovakia through Visegrad Grants from the International Visegrad Fund. The mission of the fund is to advance ideas for sustainable regional cooperation in Central Europe.