On May 5, Joel Davis, founder and CEO of JD Events (JDE), the company that mounts the annual AXPONA—Audio Expo North America—proposed a “rollover plan” settlement for companies that had committed funds to the canceled 2020 show, which had been scheduled for April, postponed until August, and then, finally, canceled. The plan attempts to “right the ship in the midst of this pandemic storm” and to demonstrate the company’s “long-term commitment” to continuing to serve the audio industry. Many exhibitors were unhappy that, in canceling the show, did not offer refunds of funds already committed to the show by exhibitors and sponsors.
JDE’s plan proposes rolling over 50% of 2020 “deposits” (footnote 1) toward the 2021 show, 25% to 2022, and 25% to 2023 show. Exhibitors that go along would also retain their preferred exhibit spaces. AXPONA also promises that it will not increase their room, booth, advertising ,and sponsorship rates during the roll-over period. Even as it acknowledges “criticism, lawsuit threats and demands for refunds,’ JDE reiterates that it is in a “disastrous financial predicament,” needs time to get back on its feet, and lacks the ability to issue refunds or respond to legal claims (footnote 2).
“This pandemic is more devastating than anything we have lived through before, but we believe we will overcome this too,” says the letter from JDE to 2020 exhibitors. “We hope you will put your trust in us and place a bet on AXPONA because we will need the full support of this beautiful audio industry in order to pull off this comeback. Please ‘reply all’ to let me [Joel Davis] and the entire AXPONA team know if you support JDE and the above rollover plan. We look forward to hearing from you.”
The JDE announcement followed an April 21 open letter to JD Events that demanded the show’s immediate cancellation. (According to Luke Manley of VTL, who wrote the letter, the number of signatories grew from the initial 20 to more than 100, all or almost all AXPONA exhibitors.) Then, on April 30, JDE canceled the show and announced the “no refunds” policy while promising that an unspecified portion of committed funds would be rolled over. The May 5 letter filled in the details.
How is the industry responding? Manley, author of the April 21 demand letter, apparently isn’t satisfied. “Once again, JD Events offers AXPONA exhibitors no choice,” Manley stated in a May 6 email to Stereophile. “And once again, JD Events proposes a course of action that allows them to keep exhibitor payments without offering any transparency, security, guarantees, or even a credible contingency.”
“There is absolutely no guarantee that major events will be happening in April 2021, that JD Events will actually organize the next three shows, or that the new market conditions will want or warrant such events . . .. JDE has issued no statement of expenditures or hotel rollovers and offers exhibitors no choice in whether to accept this plan or not . . .. They expect exhibitors to sign up to a murky plan that commits us to what is in effect, a 3-year, interest-free, unsecured loan. And exhibitors will be asked to come up with yet more payment in advance. In this economy? JD Events makes loud and persistent claims about supporting the audio industry, but their actions suggest that their true priorities are actually much, much closer to home.”
On May 10, Manley told Stereophile that of 46 signatories to the open letter—7 of the 20 initial signers and 39 of the subsequent 80—plus an additional 26 exhibitors who were not signatories agreed or “kind of agreed” with his comments.
However, JDE’s roll-over proposal appears to have turned the tide. While the number of exhibitors who will eventually accept the roll-over plan is unknown—JDE didn’t specify a deadline to respond—on May 10, Davis told Stereophile that he had heard back from approximately 60% of AXPONA exhibitors. “As of Sunday night, 81% have told us yes or likely yes and 19% have said no or likely no to supporting the rollover plan.”
Stereophile interviews also suggest support for the plan—if sometimes grudging support.
Elliot Goldman of Bending Wave USA expressed concerns, including what might happen if the 2021 show didn’t take place or he decided to turn his room over to someone else rather than return. He told Stereophile, “There is no really good solution here. I don’t think JDE will agree to reveal their inner finances, and I’m not interested in doing anything that’s litigious. The only people who will benefit from something like that are the lawyers. If we force JDE to go out of business, everyone loses. I want to ensure that the hotel is on board with JDE’s rollover plan, funds were paid to the hotel, and we will owe nothing more this year. [Beyond that,] I’d like to see the show continue; I don’t want to kill it, and I don’t want to see the audio industry split in two. At the end of the day, it’s time to move on.”
“I’m ok with this plan with the additional option to roll over forward another year if we are not comfortable exhibiting at audio shows in 2021,”” EveAnna Manley, President of Manley Laboratories, who before this proposal was one of JDE’s most vocal critics, told Davis in an email shared with Stereophile (footnote 3). Davis replied: “Absolutely ok with us. Thank you.””
“I believe that AXPONA is a valuable show for everyone, and I would like to see it continue,”” Paul McGowan, PS Audio’s president, said by phone. “The only way that I can see exhibitors have a shot at the 2021 show is to go along with JDE’s proposal, with the caveat that no more money will be sent to them until we the exhibitors, the city and the hotel are all satisfied that 2021 is safe and will actually happen. Once we have verification, we are willing to go ahead and send the other 50% close to show time. We also want to be assured that our spaces will not be sold off to someone else. I feel this is a reasonable compromise, and PS Audio will likely do it through an attorney.”
William (Bill) E. Low of AudioQuest, who declared his dissatisfaction with JDE’s initial cancellation policy both in the open letter and in comments on Stereophile.com, told Stereophile by phone, “I’ve always respected that, in the midst of the pandemic, JD Events is a business with its back against the wall.”
“This is not a case of us against them. Even though they made some bad PR moves, they’ve lost a quarter of a million and are trying to survive like the rest of us. Theirs is a cooperative offer, not an adversarial one.
“I wish there would have been a way for people to get back less than 100% if they wanted to pull out now,” Low continued. “Nonetheless, I urge all exhibitors who question the offer and who perhaps can’t see their way forward to 2023 to look at the offer from the other side and accept it.””
Several people who did not sign the letter shared similar sentiments. Robb Niemann of Rutherford Audio had reserved three rooms at the 2020 show, including one for Italy’s Gold Note. “AXPONA was in my opinion one of the better shows in this country,” he wrote. “If we want there to be a great show again in Chicago, I believe what they have proposed is more than satisfactory to keep their company alive and give us an opportunity and venue to exhibit in the future. Is the current situation ideal? No. But as I told JDE’s VP Mark Freed, I cannot fix his problems and he can’t fix mine, so let’s both get to work to make sure there is a reason to attend next year or the year(s) after if the pandemic goes on longer than expected.”
“Unless we want to lose the show, we have all appreciated and heaped accolades on for years, I would think, as an industry, we would want to support JDE,” wrote Walter Schofield of Krell.
“Audio shows are part of the landscape for nearly all participants in the industry, and for me, a necessary and joyous part,” wrote Ray Kimber of KimberKable. “Even without product demonstrations, the networking has been essential to any success that I have had. Unless I am capable and willing to organize a new show, there seems to be value in sustaining one that exists.”
“It truly is amazing how disruptive COVID-19 has been all over the world,”” wrote Daryl Wilson of Wilson Audio, by email. “This pandemic will end. When it does, I hope the positive we contribute in peoples’ lives during this time outweighs perceptions of the hard decisions made under imposed constraints and unusual limitations.”
Footnote 1: Several exhibitors expressed dissatisfaction with the word “deposit” noting that they had paid in full in advance.
Footnote 2: In its April 30 cancellation announcement JDE stated that it did not have business interruption insurance coverage for communicable diseases and that it had lost all its investment in 2020 shows in three different industries; these claims cannot be verified.
Footnote 3: The two Manleys are not blood relatives and head up independent companies.
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