SXSW Organization On The Brink After 2020 Cancellation

SXSW has not just been canceled for 2020 due to concerns over the Coronavirus. The declaration by the City of Austin of a “local disaster” on March 6th has put the entire organization on the brink, and looking at an uncertain future.

On Monday, March 9th, SXSW was forced to slash 1/3rd of their full-time workforce, or roughly 60 employees from a staff of 175 as the organization reels from the sudden cancellation. This speaks nothing to the many part-time and seasonal employees, as well as contractors scheduled to be employed through the festival season that will not have work in 2020. SXSW is also reportedly dealing with solvency issues, and could be out of money by this summer.

Due to the City of Austin’s unprecedented and unexpected cancellation of the SXSW 2020 events in March, SXSW has been rigorously reviewing our operations, and we are in the unimaginable position of reducing our workforce,” the company said in a statement.

As the Austin Chronicle reported on the day of the cancellation, SXSW does have insurance, but none that covers “bacterial infections, communicable diseases, viruses and pandemics,” despite the reporting of Variety and others that the declaration of a “local disaster” by Austin Mayor Steve Adler was to allow SXSW to trigger clauses in its insurance policy. This means that the cancellation of SXSW in 2020 is a total loss for the organization that relies on the annual event in March for operating capital. SXSW brought an estimated $355 million in economic activity to Austin in 2019.

But the layoffs could just be the beginning. More layoffs and restructuring could be coming, while the slashing of its full time employees will make it more difficult for the organization to figure out a way to salvage the 2020 presentation and turn it into a virtual experience as some had planned for, though this still might be a possibility, just at a more scaled level. Nonetheless, the City of Austin is having to contemplate if they didn’t just cancel the event for this year, but cancelled it for good.

Meanwhile the SXSW organization itself is not the only entity being injured by the development. NME talked to numerous artists who were planning on attending, including multiple performers who say the cancellation is devastating, and they may never recover from it themselves with all the preparation and overhead and they put into the event. KUT talked to a cross section of venue owners, service industry workers, bars, restaurants, food trucks, photographers and filmmakers, rideshare workers and rental property owners about the adverse impact of the cancellation, many of whom will have a tough time making ends meet due to the cancellation.

But unofficial parts of SXSW will still go on, with many venues and performers who were scheduled to perform at unofficial functions or added unofficial parties to their roster of official performances still planning to travel to Austin. As attendees to SXSW can attest, the unofficial portion of the event are a big part of the annual gathering. Heard Presents, Prism.FM, the Red River Cultural District, and others are banding together to strengthen this year’s unofficial lineup and provide performances spaces for artists and bands still planning on attending. They have also set up a fund which performers can apply for, and a Go Fund Me that has raised over $17,000 so far for artists and others who’ve been adversely affected by the SXSW cancellation.

Willie Nelson’s Luck Reunion, which is scheduled for Thursday, March 19th in Spicewood, TX some 30 miles outside of town is one of the biggest unofficial events with thousands of attendees, and nearly 40 artists originally scheduled to perform. It was approved by the county to move forward on Tuesday morning (3-10), but is still working on confirming talent and other logistical issues due to the greater SXSW cancellation before announcing their revamped plans (Saving Country Music will have an update as soon as one is available).

However, these unofficial events will not do much to offset the greater economic impact the region will suffer by the cancellation, yet could increase the risk that someone carrying the Coronavirus could still enter the city during the SXSW period between March 15th and 22nd, while the SXSW organization itself won’t be participating in any of these events. Ironically, taking SXSW itself out of the picture eliminated the only governing body over the annual event that could have implemented such precautions as limiting crowd size, restricting certain events only to open air spaces, regulating the amount of attendees, banning attendees traveling from affected areas, setting up hand sanitizing stations or even quarantine areas if necessary, or doing health screenings and temperature checks of attendees before they’re allowed entry. Now SXSW 2020 could be a free for all.

Still, the City of Austin has said they are reserving the right to cancel any gathering under the provisions of their “local disaster” declaration. They will be looking at crowd size (2,500 or bigger), crowd density, if it’s an indoor or outdoor event, if the event registered with either the city or the county, and if they’ve taken proper precautions to ensure public health such as the number of restrooms and hand washing stations. This has left many artists in limbo about whether they should come, and what unofficial showcases planned months in advance may or may not occur, not to mention the new events being organized in light on the greater SXSW cancellation.

Saving Country Music has reached out to numerous unofficial showcase promoters to see what their plans are, and many are still waiting for confirmations or clarifications from artists or local authorities. Bloodshot Records—one of the long-time participants in SXSW which holds an annual free unofficial day party each year had still not made a decision as of Tuesday morning (3-10). Two Bloodshot Records artists—Jason Hawk Harris and Sarah Shook and the Disarmers—have already pulled out. But The Yawpers and The Waco Brothers are still planning to attend.

But the bigger question is what the annual SXSW gathering may look like moving forward after the 2020 cancellation. Subsequent years may need to be scaled back, if they happen at all as the organization deals with solvency issues. Will the City of Austin or others step up to help the organization out? Could SXSW sue the City of Austin due to their declaration of a “local disaster” without a single case or even suspected case of Coronavirus within the city or great county region?

For many years local Austin residents have criticized SXSW for being too bloated, too unorganized, full of safety concerns that were exacerbated with the killing of 4 people and the injuring of 26 in an auto rampage in 2014, and the general congestion the event brings to Austin annually. Many of these concerns were addressed and mitigated in the last few years after the incident, and the advent of rideshare apps and other improvements have made SXSW less of a headache. Nonetheless, many in the city, and many of the attendees see SXSW as sort of a “necessary evil” as opposed to a great opportunity.

Perhaps the scaling back of SXSW will have a silver lining by helping to once again refocus the perspective and scope of the event similar to 2014. But it won’t be on SXSW’s terms as the company now faces an uncertain future, while the economic impact SXSW has for the City of Austin will not be easy to replace.