They canceled it:

Asked if the financial loss of cancellation will be covered by an insurance plan, SXSW co-founder Nick Barbaro – who is also the publisher of the Chronicle – said the organization does not have cancellation insurance relating to a disease outbreak or triggered by the city declaring a “local state of disaster.”

SXSW co-founder and Managing Director Roland Swenson, reached by text, further explained: “We have a lot of insurance (terrorism, injury, property destruction, weather). However, bacterial infections, communicable diseases, viruses and pandemics are not covered.”

Those statements refute a widely shared article, published in Variety on Thursday, focusing on how SXSW would benefit from the city shutting it down, rather than cancel on its own volition. The news story, written by Chris Willman, posits that “With $356 million pumped into the local economy by the fest last year, Austin has a lot to lose by canceling SXSW. And the festival would likely lose out on insurance if it, not the city, did the axing.”


I wouldn’t go … this is madness… this could be a ground zero event that would spread the virus to 100s of thousands of Americans. SHUT IT DOWN. But they can’t financially they are obligated to push on.

I always thought SXSW people were overpaid weenies who would shell out 1800 bucks for a festival. Maybe the world is better without them.


“A lot of people just don’t want to travel right now (because) nobody really knows how severe this thing is,” Weinstein said. “If (SXSW) goes ahead, I think attendance will be down, perhaps significantly.”

But that forecast is uncertain, he said, because SXSW’s large music and technology components attract a relatively young demographic that might not be quick to bail. Local public health officials have cited a similar scenario, saying many would-be attendees who already made travel arrangements are likely to come to Austin anyway even if it SXSW is called off.

What’s clear is that scrapping the event would deal a financial blow to the hospitality industry in downtown Austin. The move also could be a big blow to SXSW itself, experts say, depending on the company’s insurance coverage and how it opts to handle possible refund requests.

For the broader Austin metro area, however, a SXSW cancellation would constitute little more than a blip from an economic perspective. A report commissioned by SXSW estimated the economic impact of last year’s conference at about $356 million — about a quarter of 1% of the region’s estimated $150 billion annual economy.

“While it’s indisputable that canceling the event would be devastating for those in the affected (hospitality) sectors, Austin has a large and diversified economic base,” said Michael Sury, a University of Texas economist and finance lecturer.

The precise financial impact on SXSW as a company is uncertain. The festival’s estimated $356 million economic impact included about $157 million SXSW attributed to operations, such as its year-round activities and staff.

Michael Giusti, an insurance expert and senior writer at, said organizers of major events generally have cancellation coverage. But such policies typically kick in only if an event can’t go forward, he said, such as when the headline act for a rock concert drops out — or, in the event of a pandemic, public health officials won’t allow an event to take place.

“If it’s your choice, it’s almost never covered” in a standard policy, Giusti said. “If you canceled (an event) because you were scared, or you had low attendance because your attendees were scared, it’s almost certainly not covered.”

He said it’s possible to purchase a policy allowing an organizer to cancel an event for any reason, although it would be expensive.

Regardless, the potential financial hit is hardly the only consideration for SXSW organizers as they weigh the fate of this year’s conference.

Tim Calkins, a marketing professor at Northwestern University’s Kellogg School of Management, said the long-term effects of a coronavirus outbreak during SXSW could be far more severe than a one-time cancellation.

“The challenge is you don’t want South by Southwest to be known as the place where the virus really got spread,” Calkins said. “If you become that place, you do long-term damage to your brand.”

That’s likely among the reasons many other conferences and special events nationwide and globally are being called off, he said.

“People might be disappointed if (SXSW) is canceled, but nobody would say that was a crazy decision in light of all the uncertainty that’s happening right now,” Calkins said. “There’s a lot of potential downside to running South by Southwest (this year) and not that much upside.”

A number of public relations experts agreed that SXSW will face a backlash — and possible long-term damage to its global reputation — if it opts to go forward with the festival this year and something goes wrong.

“That’s the worst thing that could happen — if people get sick and blame South by Southwest for it,” said Gary Wilcox, a professor in UT’s Stan Richards School of Advertising and Public Relations. “It could ruin the brand.”

SXSW will have to weigh that risk, Wilcox said.