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On March 6, SXSW canceled its 2020 festival due to concerns surrounding the recent coronavirus outbreak. It marked the first cancellation in the annual Austin event’s 34-year history. Now, SXSW’s parent company SXSW LLC has laid off roughly a third of its 175 year-round employees, according to a new report by local paper the Austin Statesman,
In a statement to the Austin Statesman, SXSW LLC said that the company “has been rigorously reviewing our operations, and we are in the unimaginable position of reducing our workforce,” adding: “We are planning for the future and this was a necessary, but heartbreaking, step.” The festival is said to bring in over 100,000 visitors to Austin every year, creating an economic boost many small businesses depend on. According to the Statesman, SXSW is concerned it could lose tens of millions of dollars in the wake of the cancellation.
In addition to the revenue loss SXSW LLC faces, the company recently released a statement to The Austin Chronicle confirming that they have no insurance protecting against this particular type of cancellation. “We have a lot of insurance (terrorism, injury, property destruction, weather),” SXSW co-founder and Managing Director Roland Swenson told the Chronicle. “However,” he added, “bacterial infections, communicable diseases, viruses and pandemics are not covered.”