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Shifts in Scandinavian Market Force Producers to Create New Strategies

With the Scandinavian market becoming increasingly divided between blockbusters and indies, mid-budget films are left in limbo and struggling to get financial backing.

“The polarization starts at the funding stage,” says Hakon Overas of Norway’s 4½ Fiksjon, the production company behind Hans Petter Moland’s “Out Stealing Horses,” in competition for the Golden Bear in Berlin. “[The Norwegian Film Institute] won’t give money to those films ‘in the middle,’ the ones we used to make.”

Moland’s business partner Turid Oversveen agrees. “We used to focus on quality art films, but today we are forced to include blockbusters and more commercial films or we are out of business.”

For Torleif Hauge, Project Advisor at the Nordisk TV and Film Fund, the investors’ risk-averse attitude is down to consumer behavior: “People still go to the cinema, tickets are selling like never before, but more money is going to blockbusters because that’s what people go to see.”

Figures provided by the Danish Film Institute tend to confirm this: with 13 million tickets sold in Denmark in 2018, cinema attendance was the same as a decade earlier.

“It’s not because the audience doesn’t want to go to the cinema anymore,” says DFI CEO Claus Ladegaard, “it’s because they want more cinematic quality. That’s a challenge that we are starting to grasp but we still have a way to go.”

The consensus is that the mid-budget dramas Scandinavians are so fond of are suffering directly from competition by global streamers and public broadcasters.

“My guess is that part of the audience is actually watching good American indie dramas on Netflix or HBO Nordic and not watching these films at the cinema. There is also competition from domestic TV series: DR and TV2 are doing pretty much the same kind of films we used to make. TV series are extremely good at this,” says Ladegaard.

Europe has become the new battlefield in the global streaming war. When it comes to Netflix, Norway ranks second after the U.S. in terms of user penetration, with Denmark, Sweden and Finland close behind. The figures also correspond to a greater number of native Netflix original series, which, unlike native language feature films, travel well within Scandinavia.

For Icelandic producer Magnus Vidar Sigurdsson, working with the streaming giants is both an opportunity and a Faustian bargain.

“I need these streamers to close my funding gap. In a way, it’s positive, it’s a new way for me to finance films. But the question is: are you willing to sell over all territories over the years? That’s the big question — where do you draw the line?”

To cater to demand, Scandinavian countries are experiencing what financiers describe as a talent shortage, with many industry professionals in full-time production both at home and abroad.

In Sweden, the problem is compounded by the fact that it is one of the last European countries that does not offer tax incentives on local productions.

“A very Swedish movie like ‘Moomin,’ based on a popular children’s book, is being produced in Ireland because they have a 36% reduction to offer,” deplores the chairman of the Swedish Film & TV Producers Assn., Eva Hamilton.

Countries like Norway and Iceland, which offer stunning landscapes, highly skilled crews and an attractive 25% tax break, have a long history of enticing major Hollywood productions.

In Denmark, which has lost a considerable number of established film directors to Hollywood, authorities are trying to come up with solutions to retain local talent and produce the kind of films the public wants to see. In January, the Danish Film Institute announced it would back more higher-budget Danish-language films — between €6 million-€8 million ($6.8 million-$9 million) — under the government’s new Film Agreement.

Another incentive to encourage directors to return to Scandinavia is the unrivalled control they enjoy over their films.

“There’s trust between directors and producers in Scandinavia, we still have the concept of the director’s cut,” stresses Erik Hemmendorf, CEO of Sweden’s Plattform Produktion, which he co-founded with Oscar-nominated director Ruben Ostlund (“The Square”).

“We go and see a [director’s] film rather than an actor’s film, that is really unique. We cannot really compete with the Americans in any other way.”

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