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Historic SXSW cancellation leaves Austin arts industries reeling

Christina Tan/Thresher

By Katelyn Landry     3/10/20 5:56pm

South by Southwest, an annual music, film, technology and media festival held in Austin, was canceled Friday, March 6 amid concerns about COVID-19. The cancellation was ordered after both the City of Austin and Travis County declared a local state of disaster on Friday. Despite having no reported cases of coronavirus in the Austin area, the declarations were signed by Mayor Steve Adler and Travis County Judge Sarah Eckhardt as a precautionary measure against the rapidly escalating epidemic. 

In a written statement, SXSW lamented the unprecedented nature of the cancellation — it is the first time in 34 years the internationally known festival will not go on. The cancellation of SXSW is not only disappointing for the indie music scene and film circuits, which lose out on invaluable audience exposure and media coverage, but it will also be extremely devastating for the Austin economy in more ways than one, and potentially for years to come. 

SXSW co-founder and chief executive Roland Swenson has expressed doubt about continuing the festival in 2021 due to tens of millions of dollars in company losses. Swenson told the Wall Street Journal that the company’s insurance policies do not cover disease-related cancellations, so every contract cancellation with artists, venues, hotels and other companies will likely result in significant losses for SXSW LLC. The company has also laid off a third of its 175 year-round employees as of Monday according to the Austin American-Statesman

“We’ve had to show our insurance policy to all kinds of people, and nobody ever said, ‘Hey, there’s a big hole here,’” Swenson said. “We did not anticipate a pandemic. We’d always taken the attitude of, ‘Well, we’ll never cancel, so that’s not going to be an issue.’”

According to a report commissioned by SXSW in 2019, the total economic impact of the festival was about $356 million last year — about a quarter of 1 percent of the region’s estimated $150 billion annual economy. The city’s hospitality, tourism, restaurant and entertainment industries rely heavily on the 10-day event which brings over 100,000 festival attendees into local businesses and small music venues. For so many hand-to-mouth service workers — bartenders and waiters, cab drivers, stagehands — the cancellation means losing out on one of the most profitable times of the year.  

“It’s completely and utterly devastating and will be felt by every venue, every service worker, people who provide things like ice or the bars,” said Tamara Hoover, co-owner of Cheer Up Charlies, a popular queer bar and music venue in downtown Austin.

Event spaces and music venues are being hit especially hard, losing large percentages of annual revenue that are entirely dependent on SXSW each year. While some Austin venues like Stubb’s Bar-B-Q and the Mohawk are successful year-round, Austin concert promoter Graham Williams says many smaller venues literally survive off of the festival.

“The amount of venues that use that week-plus of slammed bar sales to get them to the end of the year (especially after the slow winter months) will shock you,” Williams wrote in a Facebook post. “I don’t know how some of them are going to make it to the end of the year.”   

In the week preceding the festival’s cancellation, several big-name businesses pulled out of the conference due to concerns about a potential outbreak. Twitter, Facebook, TikTok, Apple and Netflix were among some of the first companies to announce cancellations of their sponsored events and panels in the middle of last week. Several music performance agencies, movie studios and other tech companies followed suit, stressing the health of their employees as their top priority. 

For many local music artists and creatives, the annual event presents a priceless opportunity to catch the attention of record labels and industry executives. While festivals like Austin City Limits are generally populated by high-profile artists who have already made a name for themselves nationally and globally, SXSW has long served as a gateway for local musicians to enter the world of professional music recording and production. Now with that opportunity gone, local acts will have to wait at least another year before they can market their talents beyond the Austin crowd.

“Being in Austin, you don’t get to see a lot of people from LA or New York, industry-wise, very often. So this was a good reason to do [SXSW] and timely for me for sure,” said Dossey, an Austin-based musician and official SXSW artist this year who was hoping to find label representation at the festival, according to Austin’s NPR Station KUT 90.5.

People are already trying to pitch in to fill the gaping hole that SXSW’s cancellation will leave in the pocketbooks of service workers and local musicians by launching online fundraisers. One relief fund, started by Austin-based social marketing agency T3, is collecting money to distribute to service workers, hospitality staff, bands and other individuals impacted by the cancellation from March 13-22. 

“Thousands of Austin service workers and musicians will be hit significantly from canceled events, lost wages and tips,” wrote T3 on the GoFundMe page. “Long timers, we’re real people who were concerned about the intensely local and personal fallout from SXSW 2020 being canceled. We live here in ATX and care about the people who make it our home. We’re not doing this for publicity, but to help our city.”

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