Turkish Technology Sector

The technology sector in Turkey is growing quickly, becoming an important part of the country’s economy. Turkey is no longer a newcomer to the tech field; it now boasts a lively and expanding market. This growth is powered by a young, tech-savvy population, strong government support, and a spirit of entrepreneurship. Several Turkish tech startups have even made a name for themselves on the global stage. This article gives an overview of how the sector developed, what industries lead the way, which cities are key centers, some important companies, and how government and businesses work together to shape its future. We’ll also look at the opportunities and issues Turkey faces as it grows its technology sector on the world stage.

Quick Overview of Turkey’s Technology Sector

Turkey’s tech sector, especially the Information and Communication Technologies (ICT) area, is a key driver of the country’s economy. The sector has seen fast development and is playing a bigger role internationally. This isn’t only about big profits; it also shows a shift in focus toward digital work and services throughout the country.

The sector’s main strengths are its flexibility and ability to attract investment. This shows that Turkey has a clear strategy and lots of skilled people, putting it on the map as a noteworthy technology center for the region and beyond.

Important Numbers and Market Size

• The total value of Turkey’s ICT market was about USD 24.7 billion in 2022.
• The sector’s average growth has been 25.2% per year in Turkish Lira for the last 5 years, despite changes in currency value.
• There are over 9,000 active tech companies in Turkey, employing more than 213,000 people.
• Around 70% of the workforce is under 35 years old, bringing fresh energy and a willingness to try new technologies.
• Turkey’s high-tech exports reached $9 billion last year, and ICT exports hit USD 3.44 billion, mostly going to the EU, MENA, Asia, and North America.
• Since 2000, international investments in the sector have reached about USD 19 billion.

What Makes Up the Tech Sector?

In Turkey, the “technology sector” mostly means the Information and Communication Technology (ICT) sector. ICT covers work in both manufacturing and services that handle electronic information, communication, and how information is shared, processed, or shown.

Key sub-sectors include: 5G and fiber optics, the Internet of Things (IoT), Machine-to-Machine (M2M) tech, Edge Computing, Cloud/Data Centers, cybersecurity, e-Government, consumer electronics, e-sports, gaming, robotics with AI and AR, e-commerce, blockchain, wireless services, and IPTV.

How Technology Developed in Turkey

Turkey’s history with technology goes back centuries, with roots in traditional education and continued pushes for modernization. Over time, changes in government policy, investment, and private enterprise have all fueled its current, strong position in technology.

Starting Out and 20th Century Growth

Modern technical education in Turkey began in 1773 with the founding of Istanbul Technical University as a naval engineering school. Over time, its focus widened, eventually covering all sorts of engineering and technology disciplines.

During the 20th century, technical advancements moved from mostly military applications to broader technology use. The government founded institutions such as TÜBİTAK and TÜBA to take charge of scientific research and support further development. By the late 1900s, Turkey was interacting with global technology trends and realizing the need for an educated workforce.

Major Changes Since 2010

The last decade has been important for Turkey’s tech progress. Widespread smartphone use, higher internet access, and strong e-commerce growth became noticeable starting in the 2010s. The launch of 4.5G (LTE) in 2016 boosted mobile broadband, e-commerce, and digital banking. By 2020, about 81 million 4.5G subscribers made up 92% of the data market.

The government put forward plans like the 2019-2023 strategic plan to improve the digital network and encourage the best IT solutions. Local telecom companies began supporting smart city and IoT projects. At the same time, more students completed studies in engineering and ICT each year, with over 100,000 graduates in 2022.

Latest Trends and Breakthroughs

Heading into 2025, Turkey’s technology sector is focused on pushing the country into the top ranks for innovation. Successful examples include advancements in defense tech, the launch of electric vehicle brand Togg, and space mission plans. The government is investing in AI, robotics, and advanced defense equipment, with companies like Baykar making notable progress.

5G technology is being tested and is set for major city rollouts. Cybersecurity is a big focus, with increased spending and initiatives like the Cyber Security Cluster Project. Fast-growing areas such as AI, Fintech, and blockchain are pulling in investors. Over 1,000 active startups, aiming for 100 unicorns (companies valued at $1 billion+) by 2030 just for Istanbul, speak to Turkey’s lively and ambitious tech startup scene.

Main Industries in Turkish Technology

Turkey’s tech sector includes many different industries, each pushing the country forward in the digital world. Below are the most important parts of the sector:

Information Technology and Software

• The market for information technology hit $11.7 billion in 2022, up from $6.9 billion the year before.
• IT solutions are being taken up across many businesses, with demand for cloud computing, enterprise resource planning (ERP), and customer relationship management (CRM) growing fast.
• Traditional IT services like consulting and programming are also important sellers.
• More graduates in the field help support this growth, and innovative companies like Insider show Turkey’s ability to develop new products.

Telecommunications and Data Networks

• The communication technologies market grew from $9.1 billion in 2021 to $13 billion in 2022.
• More than 97 million mobile phone users, with the majority on smartphones, drive the demand for fast data.
• Turkcell, Vodafone, and Turk Telekom/TT Mobil are the leading network operators.
• The rollout of 5G is a major focus, with a government commitment of $5 billion for its development.
• Plans are also underway to expand fiber Internet, and local firms are teaming up with companies like Nokia, Ericsson, and Huawei.

Consumer Electronics and Hardware

• Young people in Turkey are eager for the latest devices-smartphones, tablets, PCs, and more.
• Samsung leads the smartphone market, with Apple, Xiaomi, Oppo, Vivo, and Huawei also having strong sales.
• Growth in this sector is closely tied to better mobile networks and greater availability of high-speed internet.
• Turkey’s location supports both local manufacturing and imports, meeting strong local demand.

Cybersecurity

• Certain parts of Turkey’s economy, especially state agencies, are targets for cyber-attacks.
• In 2019, 136,000 attacks were recorded in Turkey.
• The government is putting more money into both hardware and software security solutions.
• Major needs include network and data protection, cyber governance, and security for mobile and web services.
• Organizations such as BTK and the Ministry of Transport and Infrastructure have created response teams and bring together public and private experts to develop better tools.

AI and Fintech Developments

• Artificial Intelligence, robotics, and automation are quickly getting bigger roles in business and industry (sometimes called Industry 4.0).
• Turkey’s banks and finance sector are introducing new digital services such as e-wallets, QR cashouts, and smart payments.
• AI companies are working on local language models (including plans for a “Turkish ChatGPT”), often with international cooperation (especially for hardware like NVIDIA chips).
• Startups are building AI-based tools for marketing, customer service, and other business solutions.

Main Tech Hubs and Innovation Centers

Turkey’s technology development is spread across several cities. Each hub brings together founders, skilled workers, capital, and support networks.

Istanbul: Leading the Way

• Istanbul is Turkey’s top tech city, with about 16 million people and a lively startup culture.
• The city is home to three “unicorn” startups already and is aiming for 100 by 2030.
• Major tech brands born in Istanbul include Getir, Trendyol, and Insider.
• The transformation of Atatürk Airport into a giant tech hub shows how much the city is investing in its digital future.
• Universities in the city supply a steady stream of tech graduates.

Ankara: Research and Development Center

• Ankara plays a central role in government-led research and hosts important technoparks (technology parks).
• Across Turkey, there are over 80 technoparks (by 2023, the number is 89), with about 6,000 companies working in research and development.
• Ankara’s R&D centers are closely tied to universities and public agencies like TÜBİTAK.
• Almost half of all ICT staff in Ankara’s technoparks are involved in research and development.

Izmir and Other Growing Tech Centers

• Izmir, Kocaeli, and Antalya are growing fast as second-tier technology clusters, offering lower costs and a close-knit business community.
• 5G tests and improved infrastructure are supporting the rise of these regions.
• Each hub benefits from its local universities and technical parks.

Key Turkish Technology Businesses and Startups

Turkish tech companies now boast several international success stories, from startups to large corporations.

Big Successes

• Getir: Launched fast grocery delivery in Turkey and expanded to Europe and the US, now valued close to $12 billion with over 30,000 employees.
• Trendyol: Turkey’s first “decacorn” (worth over $10 billion), especially strong in e-commerce, with plans for public listings in the near future.
• Peak Games: Became Turkey’s first unicorn after being sold to Zynga for $1.8 billion in 2020.
• Hepsiburada: Listed on the Nasdaq stock market.

Unicorn Startups and Fast-Growing Companies

• New unicorns include Dream Games (mobile games), and AI firms like Insider.
• Other up-and-coming names: BiTaksi (ride-hailing), Modanisa (online fashion), and Pisano (business software).
• In 2022, startups in Turkey raised $1.7 billion, and many showed off their inventions at CES 2024, such as smart bikes for kids and canes for the visually impaired.

Main Tech Companies

• Telecom: Turkcell is the top mobile operator, also listed on the NYSE and Borsa Istanbul. Vodafone and Türk Telekom are close behind.
• Global firms like Samsung, Apple, Nokia, Ericsson, Huawei, and Cisco are also important players, often working with local operators.
• Turkish companies such as Arçelik and Turkish Airlines support the tech scene by running venture capital funds and accelerators for startups.

Government and Private Sector Roles

Turkey’s thriving tech industry results from both government planning and active efforts from private businesses.

Government Support

• The R&D Law (started in 2008, updated in 2016) offers tax breaks, VAT cuts, and social security discounts for research work.
• Big national plans, such as the 2019-2023 strategy and the 2030 Technology Strategy, guide the sector’s development.
• National Technology Initiative (since 2018) aims to create unique Turkish alternatives in key areas like defense technology.
• HIT-30 Program: Directs money to companies making chips, mobility solutions, and digital products to help Turkey stand out on the global stage.

Main Public Agencies

• TÜBİTAK: Coordinates and funds scientific projects, including AI development.
• TÜBA: Supports science research and education.
• BTK: Oversees the communications sector and guides the move to 5G.
• Ministry of Transport and Infrastructure and the Digital Transformation Office: Focus on issues like cyber incident response and the national digital agenda.

Private Sector and Investment

• Since 2017, businesses have invested more in R&D than government and universities combined. Private capital is now essential to tech innovation.
• Following the pandemic, more money flowed into e-commerce, delivery tech, mobile games, and digital services.
• In 2021, there were 22 private equity deals worth $2.27 billion and 217 venture capital deals totaling $1.89 billion-an 800% increase in VC activity.
• Major Turkish companies like Arçelik and Turkcell run their own venture capital and accelerator programs for startups.

Top Universities and Research Institutes

Universities and research centers are at the heart of Turkey’s technology advancement.

Main Technical Universities

• Istanbul Technical University: Founded in 1773, among the world’s oldest, and a major source of engineering talent.
• Other leading tech-focused schools: Yıldız Technical, Karadeniz Technical, Middle East Technical, Gebze Technical, İzmir Institute of Technology, TOBB University of Economics and Technology, Bursa Technical, Erzurum Technical, and Adana Science and Technology University.
• Over 100,000 students graduated in ICT fields in 2022.
• Areas needing more graduates: mathematics, computer science, and statistics, which only attract 2% of all university entrants.

Main Research Institutes

• Key institutes under TÜBİTAK include the National Metrology Institute, Electronics and Cryptology Institute, Space Technologies Research Institute, and Marmara Research Center.
• Other important organizations: Izmir Biomedicine and Genome Center (biotechnology), TAEK (nuclear energy), and the Defense Industries Research and Development Institute.
• More than 1,200 R&D centers and over 81,000 people work in research across Turkey.
• Collaboration between industry and these centers is common, especially on strategic and applied research.

International Partnerships and Geopolitics

Turkey’s approach to technology relies on working with other countries and balancing relationships with major global powers.

Working with Europe, America, and China

• Turkey aligns parts of its tech sector with European Union rules, spends on quality IT products, and joins joint projects like Horizon Europe.
• American companies (Google, Meta, NVIDIA) play a big part in Turkey’s access to software, social media, and hardware for AI development.
• China is a key partner for affordable telecom equipment and infrastructure; Turkish companies work with Huawei for 5G rollout.

How Diplomacy Impacts Tech Growth

• Turkey prioritizes building its own technology to increase national security and stand independently.
• But developing advanced tools like AI, 5G, and chips without outside help is difficult.
• International tensions (such as US-China trade issues or EU digital governance rules) can affect how and where Turkey gets its tech supplies.
• Tech policies must juggle political and economic needs, sometimes facing trade-offs between access to equipment and meeting international standards or regulations.

Opportunities and Challenges in Turkish Tech

Turkey’s technology field offers big chances, but also faces several hurdles.

Where the Growth Is: 5G, Fiber, and Cloud Computing

• 5G networks: Big investments and planned rollouts will create demand for related services and devices.
• Fiber Optics: Improvements to internet networks will allow more people and businesses to have fast, reliable broadband access. Subscriptions could reach 23 million in a decade.
• Cloud Computing: Strong growth in software and services through the cloud, creating opportunities across many sectors.
• Emerging Areas: IoT, AI, blockchain, and robotics are all growing quickly.

Main Challenges: Laws, Skills, and Exports

• Regulation: Taxes like the digital services tax (7.5%) and strict rules for foreign tech platforms can make it tough to do business.
• Skill Shortages: Not enough people are trained in computing or statistics, and this limits how fast the sector can grow.
• Export Issues: Most high-tech exports are military; only about 3.6% of all exports are non-defense high-tech products. New tech products often struggle to reach international markets.

Cybersecurity Threats

• Frequent cyber-attacks mean there’s always a need to improve digital defenses.
• Government investment is growing, and specialized teams (SOMEs) respond to incidents.
• Turkish tech companies and agencies aim to develop local cybersecurity products and services, though this requires continuous effort to keep up with changing threats.

Frequently Asked Questions

What are the top Turkish technology startups?

• Trendyol: Leading e-commerce platform, Turkey’s first “decacorn.”
• Getir: Global instant grocery delivery service.
• Peak Games: Mobile game company acquired by Zynga.
• Dream Games: Another big name in mobile gaming.
• Insider, BiTaksi, Modanisa: Notable in AI, ride-sharing, and online retail.

How does Turkey’s government support tech innovation?

• Through laws providing tax and social security benefits (R&D Law).
• By running long-term strategy programs focused on innovation until 2030.
• By offering benefits and networking opportunities in technoparks.
• Via agencies like TÜBİTAK and BTK driving new technologies and projects (like 5G and cybersecurity investments).

Which cities are the main centers for tech in Turkey?

• Istanbul: The largest and most active, with many startups and investment deals.
• Ankara: Research and development powerhouse with many technoparks.
• Izmir, Kocaeli, Antalya: Up-and-coming cities with growing tech ecosystems.

What are the biggest challenges for Turkish tech businesses?

• Regulatory barriers and unpredictable laws for digital companies.
• A need for more STEM talent and a more commercial approach to innovation.
• Difficulty moving beyond military exports to sell non-defense tech globally.
• Access to later-stage funding and the effect of international politics on business partnerships.

How can people get involved in Turkey’s tech scene?

• By attending coding bootcamps or enrolling in university tech programs.
• Joining events and networking through groups like TÜBİSAD.
• Applying to startup accelerators or government-backed tech initiatives like Türkiye Tech Visa.
• Participating in festivals (e.g., Teknofest) or working with established companies in major tech cities.