I feel your pain. There are many events in Austin, Texas, that I've gone to in past, thoroughly enjoyed, but don't go to any longer because it's just such a pain to fight the crowds.
However, this year, if you really want to hear the music, but you don't want to slog your way through masses of people, you have an alternative. Shhhhhhh. Don't tell anybody!
The alternative is a relatively new venue in Taylor, Texas, just a short hop east out of Austin down Highway 79. The Armadillo Hall (run by a former long-time employee of Armadillo World Headquarters of blessed memory) opened up last year in Taylor. They responded to an ad in the Chronicle looking for venues for bands, and were told there were 3 bands looking for a place to play. One thing led to another, and now there are 50 bands playing at Armadillo Hall, Wednesday through Sunday, at the first annual Armadillo Fest. As they say, not in competition with SXSW, but an alternative place for the locals to go and hear some great music.
So, check out the lineup (and the prices! $5.00 cover in advance, $7.00 at the door!, $14.00 for all day on Saturday!). Boogie with the Armadillo! You might find that that sweet, quick drive to Taylor is definitely worth it.
And, when the festival is over, try them out later - they've got big plans!
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