SXSW grows while music biz withers

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South by Southwest is like spring break for rock stars.

The annual music festival, which began Wednesday, draws musicians and fans from around the world to Austin, Texas, for four days of booze, barbecues and rock 'n' roll.

"At SXSW, all the bands are there, and everyone is dying to play shows," says Adam Shore, general manager of Chicago-based indie label Vice Records, which is organizing a showcase and two parties. "Bands aren't even asking us for money. They're just asking for beer."

The festive atmosphere persists even though the music business hasn't had much to celebrate during the past few years. So far, 2007 is no different. Overall U.S. album sales are down 16% from the same period last year, according to Nielsen SoundScan.

Yet SXSW continues to grow.

Last year SXSW had its largest music attendance to date with more than 10,000 registrants and 12,000 attendees who purchased wristbands for club access only. And there's no shortage of labels lining up to stage showcases.

This year alone, more than 90 labels, many independent, have committed to hosting official SXSW showcases.

"It's a great opportunity for us to knock about 20 birds out of the sky with one stone," says Glenn Dicker, label manager for Yep Roc and Redeye Distribution, which handles such acts as Los Straitjackets and Robyn Hitchcock.

Yet as SXSW's size has swelled, some are starting to wonder if there will ever again be a pure breakout band for the Austin gathering. With every genre and its subgenres now healthily represented, the buzz is spread more evenly among more acts.

"I think it's harder to be the band that comes out of nowhere and breaks out of SXSW," says Leslie Ransom, head of sales for label/distributor Touch & Go, home of such bands as Ted Leo and the Pharmacists, !!! and Arcwelder.

"It's indicative of what's happening to the industry as a whole. The No. 1 record used to sell 1 million copies, but that does not happen anymore. There's just so much more out there, and so much more access to so many different things."

These days, in-demand acts such as modern girl group the Pipettes and psychedelic garage rockers the Black Lips play multiple shows throughout the week, sometimes as many as three per day. With the constantly growing crowds making it difficult to get into any notable nightly showcase, Vice's Shore says he has to keep his bands -- the Black Lips among them -- working.

"There's so much competition," he says, "the only way to even be seen is to play a lot."

Things have changed quickly.

When Domino Records brought over Franz Ferdinand from the United Kingdom in 2004, the act played one SXSW showcase at Buffalo Billiards. The buzz turned into a deafening roar, and Domino, which struck a deal with Epic in the United States, ended up with one of the hottest rock records of the year.

Domino U.S. label manager Kris Gillespie hoped to repeat such events in 2006 when he brought the Arctic Monkeys to Austin. While it was one of the most talked-about acts before and after SXSW, the band's music had been widely available on the Web weeks prior to the February release of the group's debut.

The Internet fandom, coupled with its chart hits in the United Kingdom, likely stole some thunder from one of the Arctic Monkeys' first major U.S. shows.

"It just came down to timing," Gillespie says. "The band's success just got out well ahead of us by the time March rolled around. It was still a great show, but it wasn't quite as propulsive as the Franz show two years earlier."

Touch & Go's Ransom says SXSW performances rarely translate into an increase in sales. To her, the benefit of bringing a band to Austin or arranging a tour around SXSW is to help secure press for later in the year. For that reason, the label opted to have Ted Leo skip SXSW since his new album comes out in March and most press would have already been secured.

And it's a positive, Ransom says, even if the overcrowded nature of SXSW prevents a journalist from checking out a band.

Memphis Industries co-founder Ollie Jacob witnessed that effect two years ago, when hundreds of attendees lined up and were shut out of a performance by dance-pop ensemble the Go Team. He's anticipating -- even hoping for -- a similar reaction with the Pipettes, one of the most sought-after bands going into SXSW, who have just signed with Interscope imprint Cherrytree Records.

"The Pipettes is going to be a little bit like the Go Team show, I hope," Jacob says. "People aren't going to be able to see it. It's a bit s---ty, really, but that's kind of what you're there for. You want that general buzz and excitement, and it's the show that you can't get into where you say, 'I bet that was amazing."'
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