A global media corporation fully acquired South by Southwest on Aug. 28, ending four decades of local ownership of the popular Austin technology, music and film festival.
Penske Media Corporation acquired 50% of the company in 2021, after the annual spring festival was cancelled in 2020 because the COVID-19 pandemic left it financially unstable. The company later increased its stake to 51%. The sale, in which co-founder Nick Barbaro sold the remainder of his SXSW shares to Penske, gave the corporation full ownership.
Radio-television-film sophomore Neemay Shah volunteered at SXSW’s Rollins Studio Theater last spring. He ushered guests and managed capacity in exchange for a badge of his choice for either film, music or interactive events.
“It definitely felt very communal: like a sense of community, a sense of almost family like, ‘Okay, we all like this one thing, let’s all work at it and create a platform so other people can enjoy it too,’” Shah said.
Shah said he is concerned the acquisition could reduce student opportunities or make the festival more profit-focused.
“I might be less likely to volunteer, as well as many other students that I’ve seen volunteer at South By,” Shah said.
This student culture of volunteering, especially for those focused on music or film, is central to how UT students fit into SXSW, said Andy Langer, a longtime Austin music journalist who previously served as the University’s senior director of live music and entertainment.
Langer said students rarely buy the badges, which can cost upwards of $895. Instead, he said, they volunteer, attend free panels, buy the cheaper wristband options or go to official or unofficial events they discover online.
“South by Southwest traditionally has been invaluable for students that are interested in music, film, and technology because (in) the city they’re living in, the best, brightest and most famous from all three of those lanes would be here during (students’) spring break,” Langer said. “Students that chose to stick around for spring break immerse themselves in even just the free things … the panels are designed for young people to learn about those industries.”
This year, Penske offers a $6,095 “CxO badge” for corporate executives, a sign, Langer said, the company may be steering the event to be smaller and pricier.
Jacob Hall, a management lecturer in the McCombs School of Business who teaches a class on business acquisitions, said the move shows that Penske wanted a controlling interest in business operations.
Hall said Penske is like a “strategic acquirer,” because they own similar media companies such as Billboard and Variety. Although SXSW is a local company, its national and international popularity is likely what attracted Penske, he said.
Langer said the test for Penske is whether they can take a smaller SXSW festival and can still serve the students and the greater Austin community.
“The question becomes how does a smaller South by Southwest become something that offers utility for people in those three spaces — film, interactive and music — and is smaller, but still delivers bang for people’s buck and therefore can be profitable for Penske.” Langer said. “(Penske is) definitely going to be looking at the bottom line because they’re a giant corporation, and that’s how things work.”