Is SXSW's play-for-exposure model outdated? Musician advocacy group demands better pay

For years, musicians have complained about the South by Southwest Music Festival’s business model, which forces showcasing artists to choose either a low guarantee for their performance or access to festival and conference programming. On Tuesday, the national Union of Musicians and Allied Workers (UMAW), an advocacy group, published an open letter to the festival demanding better compensation. The letter was signed by more than 120 artists including Zola Jesus, Pedro the Lion, Speedy Ortiz, Sammus and Fugazi’s Guy Picciotto. In the first five hours the letter was online, the group collected an additional 830 signatures.

The current compensation structure for showcasing artists offers a choice of a one-time payment of $250 for bands ($100 for solo artists), or a wristband that grants access to conference and festival programming, as well as artist-only areas at the event. Those numbers have not changed in over a decade. Meanwhile, the application fee that artists pay to attend the festival has gone from $40 to $55, a 37% increase.

In 2022, 5,001 artists applied to the festival; SXSW does not release revenue numbers, and a spokesperson says some application fees are comped.

According to a spokesperson for the festival, of the 1,501 artists who were accepted, only 128 chose the compensation and the rest chose the registration package.

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What are the artists demanding from SXSW?

The letter published by UMAW includes four demands. First, they say the guarantee should be increased to a rate of $750 for all artists. They note that this figure is lower than the cost of a music festival badge. Badges for this year’s SXSW music fest are on sale for $895.

Next, they say artists should not be forced to choose “between being paid and attending the festival they are performing at.” Third, they are also asking the festival to drop the application fee. Finally, they ask that the festival offer the same deal of compensation plus wristband to international artists performing at the festival.

That last demand is the trickiest one, as many international artists travel to the U.S. on a visa that allows only for unpaid showcases. In order to be paid, they would need a non-immigrant work visa, which is much more expensive and difficult to obtain.

“The visa issue is certainly a larger conversation, and SXSW cannot singlehandedly solve the problems surrounding visas for non-U.S. touring artists,” Joey La Neve DeFrancesco of UMAW acknowledged via email on Feb. 6. He added that the festival should pay international artists who have eligible visas and “compensate the costs of non-U.S. artists whose visas only allow compensated costs, and aid all showcasing non-U.S. artists in obtaining visas that will allow them to be compensated for their SXSW performance.”

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The music industry has changed dramatically during SXSW’s 30-plus year history

When SXSW launched as a scrappy, industry-centered music festival in 1987, the music business was a different beast. Artists still made a large percentage of their income from album sales. Playing for an audience of industry insiders and label executives offered the tantalizing prospect of career-making record deals.

Arguably, with industry insiders still flocking to Austin for the fest, access to the festival and conference still offers the potential for artists to make life-changing connections. But the landscape for artists has changed dramatically. In the post-streaming world, artists make most of their money from live performances, with sets at more traditional festivals, such as the Austin City Limits Music Festival, offering some of the larger paydays in a touring season. For those events, artists generally do not apply. Instead, they are booked by festival organizers.

The advent of social media has also altered the calculus for artists who now have more avenues to present their work to audiences outside of an industry structure. At the same time, costs of touring have skyrocketed for artists, forcing many high-profile acts to cancel tours last year.

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SXSW recently sold a stake to the massive Penske Media Eldridge

In 2021, the owners of SXSW LLC, the company behind the festival and conference, sold a 50% ownership stake to Penske Media Eldridge. At the time, Roland Swenson, the event’s chief executive and co-founder, said the deal gave a "lifeline" to SXSW, which was devastated by the global coronavirus pandemic that forced the company to cancel its 2020 event and pivot to a virtual event in 2021.

"PME’s investment in SXSW came at a critical time during the pandemic. It has allowed us to continue to operate independently, and their input is crucial to how we approach and review company policies," a spokesperson for the festival said on Feb. 7. In addition to SXSW, Penske Media Eldridge owns music and film trade magazines Billboard, the Hollywood Reporter and Variety. The company also owns the music magazine Rolling Stone, and on Monday, PME made a $100 million investment in Vox Media, the company that owns New York Magazine, The Verge and the Eater family of websites.

“It's difficult to compare the present day music industry and present day SXSW with models from the 1990s,” La Neve DeFrancesco of UMAW wrote in an email. “The festival is no small, independent festival anymore — it's owned by a massive corporation headed by a billionaire family with infusions of hundreds of millions of dollars from the Saudi government.”

In 2018, Penske Media received $200 million in backing from Saudi Research and Marketing Group, a Riyadh-based media and publishing company.

How is SXSW responding to the open letter from musicians?

"SXSW is honored to host over 1,400 showcasing acts every March. We are committed to creating professional opportunities by bringing emerging artists together with media, the global music industry, and influential audiences. We appreciate the feedback from the UMAW and will be doing our policy review after next month’s event," a spokesperson from the festival said Feb. 7.

UPDATE: A revenue amount attributed to band application fees was removed from this story after SXSW clarified that some fees are comped. SXSW declined to say how much revenue they make from application fees. A section headline was updated to clarify that Penske Media Eldridge did not acquire SXSW. Event producers sold a 50% stake to PME.

This article originally appeared on Austin American-Statesman: Hundreds of musicians sign letter demanding better pay from SXSW