The Hungarian government – including ministries, state bodies and state-owned companies – spent a whopping HUF1.3 trillion (€3.5bn) on communication between 2015 and 2023 and what is even more astounding is that 75% of the money went to two firms owned by the same person, according to a compilation by investigative news site G7.hu on February 19.

The combined €3.5bn in state advertisement contracts roughly equals half of the entire spending in Hungary’s communication market.

The government set up the National Communications Office (NKOH) in late 2014 headed by Antal Rogan, who also heads the prime minister’s Cabinet Office. From 2015, all communication and event management tasks of state bodies, government agencies and state-owned enterprises were centralised and assigned to NKOH, which signs framework agreements with winning applicants.

G7.hu compiled details of more than 2,300 contracts awarded between 2015 and 2023 from the public procurement site's database.

In the first years of its operation, NKHO signed communication contracts to the tune of HUF20bn-60bn per annum, which began to rise rapidly in subsequent years, peaking at HUF335bn in 2021.

The market has been monopolised as 73% of all contracts, around €2.56bn, went to Lounge Design and New Land Media, companies owned by Gyula Balasy, a 45-year-old businessman with close ties to Rogan.

In 2020 his companies alone booked as much revenue and profit as the other nine largest agencies in Hungary, the profit being close to HUF100bn.

Balasy enjoys a monopoly in the event management market in state contracts with his company called Lounge Event, G7.hu writes. The company also has a strong position from market-based orders, as many companies are "well-advised" to do business with him.

Journalists from 444.hu ran into the businessman by accident at a car race at a town by Lake Balaton last summer when they spotted him in one of his Ferrari sports cars. The businessman wanted to enter the race with a 1991 Ferrari Testarossa, but when the car broke down, he swapped it for his 30-year-old Lamborghini Diablo, 444.hu adds.

In 2023, four weekly newspapers and broadcaster RTL filed a lawsuit against the government for distorting the media market by unequal distribution of advertising revenues. According to media researchers, the government distorts the media market by directing state advertising to pro-government media, which is contrary to EU competition rules and fundamental values.

State ad revenues in many of the outlets of media conglomerate Kesma, consisting of some 500 websites, newspapers, radio and television stations, account for half of their total revenue stream. Independent media maintains strong positions in the online news segment, but its operation is threatened by the discriminatory allocation of state funding.

Last October, the European Parliament on October 4 approved the European Media Freedom Act that would guarantee greater press freedom in the member states and limit distorting state advertising. The legislation aims to ensure media plurality and protect media independence from governmental, political, economic or private interference.