EXCLUSIVE: Iceland‘s production services past has driven a creative development flurry, according to key local industry figures such as Severance star Ólafur Darri Ólafsson.

Primarily known in entertainment for housing big-budget U.S. productions such as HBO’s True Detective: Night Country and Christopher Nolan sci-fi Interstellar, Iceland has emerged out of the shadows of its past as a car commercials location to become a significant player in European TV co-productions. At the same time, its domestic sector has similarly grown with local networks and streamers buying and the likes of Netflix and CBS Studios investing.

Ólafsson, the Icelandic-American actor and producer who starred in Baltasar Kormákur’s series Trapped and Apple TV+ drama Severance, said overseas productions and the country’s favorable tax break have played a major role in the situation. He has just filmed Series Mania competition contender Reykjavik Fusion, a crime-meets-cookery drama series, for his production house ACT4, France’s Arte and U.S. co-producer Wild Sheep Content.

“We shot it for around €900,000 [$1M] an episode, which to everyone outside Iceland feels ridiculously low,” said Ólafsson. “Coming from Iceland, you have to make resources go far, but we are lucky that we have had a mix of big-budget American and international productions come here, which has educated and created these really incredible crews. It also means we have equipment that probably wouldn’t be here if we didn’t have those big productions.”

Ólafsson added that Iceland and the U.S. had enjoyed a “good symbiotic relationship,” with American demand leading to the development of local production infrastructure that is now driving local development and aiding better scripting. “In other countries, it hasn’t,” he said. “In Canada or the UK, it takes over and you’re just doing American projects or you can’t compete with the money.”

We spoke to several producers with similar views for this article. Andri Omarsson, CEO of Icelandic producer Glassriver, was one. He said: “Throughout the ears we’ve been fortunate to have the good foundations from the production services – we have all the infrastructure because we have been serving Hollywood since James Bond came here in 1984 [for A View to a Kill]. We can now take that knowledge and use it for Icelandic content.”

Glassriver has emerged as a major local producer since its co-founders made true-crime drama Case for Netflix in 2014, and is one of the few companies that still does not double as a production services firm or maker of commercials and unscripted.

The firm is behind the likes of As Long As We Live, starring Mr Robot‘s Martin Wallström and sold internationally by Eccho Rights, and thriller Black Sands, co-produced with several European partners. In recent months, we’ve revealed it is making shows such as Reykjavik Noir for streamer Síminn, a series adaptation of Lilja Sigurdardottir‘s crime novel trilogy, and Manifesto, a thriller based on Iceland’s first-ever real-life terrorist attack that has France-based distributor Wild Bunch TV on board. Elsewhere, shooting has wrapped on wrapped production on its coproduction with Portugal’s SPi, Cold Haven. It is also making Masquerade with will co-produce scripted series Masquerade with Severance executive producer Nicholas Weinstock and his Invention Studios, and international co-pro specialist Marc Lorber’s The Art of Coproduction.

“After The Case, which was the first to get an MG from an international distributor, we saw that there was a path forward for Icelandic content to get international financing,” said Omarsson. “With that mindset, we founded Glassriver with the sole purpose of making internationally-financed Icelandic content that travels.”

Tax break impact

An Olsberg SPI report commissioned by Iceland’s Ministry of Culture and Business Affairs in 2024 showed that the country’s screen industry had become a “major success story” thanks to productions such as Lamb and Beast, with major international projects such as True Detective: Night Country, The Northman and Interstellar all shooting in the country.

Having assessed the 2019-2022 period, the report noted there had been a “steady upward trending growth” in the number of projects taking advantage of the Iceland Film Production Incentive, which provides TV shows and films with a 35% rebate for production that spend at least ISK350M ($2.75M) in the country. The total value distributed was “split equally” between domestic and foreign productions. Given the boom in development and Iceland-led co-pros, it wouldn’t be surprising to see this tip in favor of local developments.

Kristinn Þórðarson, SVP of Film and TV at producer and services provider Truenorth, was Chairman of Icelandic producers body SIK when the tax rebate was increased from 25% to 35% in 2022. “Since then, many of the TV series that are produced in Iceland haven’t relied on support from the film fund, which has been starved of funding for years,” he said.

“The 35% tax rebate has certainly made a huge change, as we predicted when we got the the change through. With that, and with the license fee from a TV station, you have almost 50% of the funding secured from Iceland.” This primarily relates to five-to-six-episode scripted series with budgets of around €5M-€6M.

Since Þórðarson joined Truenorth ten years ago to push it beyond production services and into originals, the company has made shows such as RÚV original The Valhalla Murders, which sold to the BBC among others, and SkyShowtime’s drama The Darkness with CBS Studios International, now a major investor in Icelandic co-pros.

“We made The Darkness in English even though we used mostly Icelandic actors, and that allowed us to double our budget because CBS International was willing to pay for an English-speaking show,” said Þórðarson. “That is one way to make the shows with higher budgets, but if we keep in Icelandic then we have a glass ceiling.”

Next up for Truenorth is Death on the Island (aka Diplomat Dies), co-produced with Canada’s Blink49 Studios and based on a book from Icelandic former First Lady Elize Reed, which we told you about first in April. Reykjavik: A Crime Story, meanwhile, is based on a book from The Darkness scribe Ragnar Jónasson and former Icelandic Prime Minister Katrin Jakobsdóttir. It’s being produced for Síminn with Dimma Pictures, a new vehicle from Jónasson and former Stampede Ventures international chief Jean-Paul Sarni that we revealed last week.

The fact that Marcella star Anna Friel is starring in and exec producing another upcoming Dimma show, limited series The Girl Who Died, is another example of that international money entering the Icelandic system.

Of course, the challenge for every local production sector is to balance the mix of English-language content demanded by international investors with a healthy amount of scripted programming shot in the local language and reflecting local culture and values. Ólafsson has high expectations Iceland can achieve that.

“We speak a language only 400,000 people speak, but people seem to be interested in stories from Iceland, which is incredibly valuable, and there is no better way of keeping a language alive than to record people speaking it,” he said. “We’ve had a lot of goodwill from across Europe, and Reykjavik Fusion wouldn’t exist without Arte and Wild Sheep, a U.S.-based company. There are co-productions to be had.”