The first South by Southwest Music Conference and Festival (SXSW) was held in 1987 in Austin, Texas. Despite the fact that Austin was not a Top 20 major market at the time, the background and character of the city made it a perfect location for the conference. Austin was considered a fairly cosmopolitan town for its size because of the University of Texas, which draws people from all over the world. As home to the state government and Texas Legislature it has also always been a popular party town, with a reputation that goes back to the 19th century when numerous nightspots and bars were populated by General Custer's troops after the Civil War. These nightspots are located in the same areas where the 6th Street and 4th Street club and bar scenes now exist.

Austin's eclectic music scene goes back to early in the city's history (from Mexican, German and colonial origins) and encompasses a wide variety of music including country, folk, jazz, blues and rock. Central Austin boasts more original music nightclubs in a concentrated area than any other city in the world.

The classic problem facing Austin musicians was being isolated from the rest of the world here in the middle of Texas. SXSW was a way to reach out to the rest of the world, and bring them here to do business. To do that successfully, SXSW needed to appeal to people other than local artists whether they were from Austin, Ft. Worth, Chicago, Toronto, Munich or Tokyo.

National interest in SXSW was immediate. For years, music businesses on both coasts had been intrigued by what was going on in Austin. The cosmic cowboy, blues, punk and other scenes had already proven that Austin was a receptive place for bands to be creative. With SXSW, music industry executives gained a good excuse to visit.

International interest in SXSW began the second year due to many Austin and American bands finding their first success in Europe. Conversely, there was a lot of interest from SXSW registrants in the international bands who came to perform. SXSW now has offices in Ireland, Germany, Australia and Japan who help bring SXSW registrants to Austin.

The music event has grown from 700 registrants in 1987 to over 16,000 registrants. As Austin has grown and diversified, film companies and high-tech companies have played a major role in the Austin and the Texas economies. In 1994, SXSW added a film and interactive component to accommodate these growth industries. SXSW Film and SXSW Interactive events together attract approximately 32,000 registrants to Austin every March.

SXSW's original goal was to create an event that would act as a tool for creative people and the companies they work with to develop their careers, to bring together people from a wide area to meet and share ideas. That continues to be the goal today whether it is music, film or the internet. And Austin continues to be the perfect location.