After being forced to cancel entirely in 2020 and hold a virtual event this year due to COVID-19, Austin’s famous SXSW festival has announced plans to return to an in-person format in 2022. And according to the Wall Street Journal, they’ll have a new partner to help them pull it off: a venture operated by Penske Media Corp., which owns entertainment publications like Rolling Stone, Billboard and Variety, will purchase a 50% stake in the festival.
The sale could potentially be the saving grace for SXSW, which lost millions of dollars when they had to cancel at the last minute in March 2020 because their insurance policies didn’t cover cancellation due to a pandemic. In the wake of that financial blow, the company was forced to lay off a third of its 175 year-round employees.
“It’s been an incredibly tough period for small businesses, SXSW included,” SXSW CEO and Co-Founder Roland Swenson said in a statement. “When [Penske founder] Jay Penske came to us with interest in becoming a partner, it was a true lifeline for us.”
Obviously any time an outside company buys a controlling stake in a beloved cultural institution, the worry is that they’ll ruin it. And while there’s no telling how Penske’s ownership will influence SXSW, at the very least we should be breathing a sigh of relief that it was an entertainment media company instead of a tech company that made the purchase. Since it was founded in 1987, SXSW has grown from a small, independent music festival focused on highlighting up-and-coming artists to a massive corporate affair in which a bunch of tech bros in khakis hand out business cards during the Interactive portion while Music attendees watch Lady Gaga perform on a giant Doritos-branded stage.
Only time will tell what Penske has planned for SXSW (though the Journal reports that he “sees the potential digital partnerships between the festival and his music and entertainment publications as a driver of long-term growth”), but perhaps the fact that he also owns several music publications means he’s more likely to return the festival to its original spirit instead of pulling it further into the tech/startup sphere. At least we now have the opportunity to see what’s in store in 2022.
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