From the SXSW FAQ for musicians:
Q: If my act is accepted for SXSW 2008, can I schedule non-SXSW Austin shows around my SXSW performance?
A: Many artists schedule private parties, record in-stores, and radio performances during the week of SXSW, and you may want to consider doing so, also. But please help make your official showcase a successful one: a showcase slot at the SXSW Festival is a valuable commodity. Consider the effect that other performances may have on the attendance at your official show. Help maximize attendance of media and registrants, and focus the public attention on your SXSW showcase. It is SXSW’s desire that your SXSW showcase experience be a positive one.
To that end, SXSW asks that you limit other appearances (private parties and record in-stores). Also be aware that acts may not perform any public shows in Austin between March 12-15, 2008. (A public show is any show that charges admission to the general public and/or is advertised in any media available to the general public and/or any show that occurs between 7p and 2am.)
You also agree to notify SXSW of other performances during SXSW so SXSW can avoid scheduling conflicts with your official showcase. If you have questions, please contact SXSW.
SXSW clarifies on Austin360:
It’s essentially the same policy that it’s always been, but we wanted to make it very clear,” Grulke said Wednesday. “It’s obviously an ongoing concern. What we want from the acts is that their SXSW showcase be the one that the primary devotion of time and resources is put toward. But the policy hasn’t changed. We just tried to make it more prominent.”