By Pauline McLean
Arts correspondent, BBC Scotland
Festivals fear funds squeeze
This summer could be one of the best years for Scotland's multi-million pound festival sector.
A rise in the number of people holidaying at home, good marketing and value for money ticket offers are being given as the reason for successful seasons so far.
The Edinburgh Science Festival, Celtic Connections in Glasgow and the Edinburgh International Film Festival are among those who have so far reported increases at the Box Office.
But there have been casualties and experts are warning that the entire sector must prepare for the toughest years to come.
Tomek Borkowy has been running venues on the Edinburgh Fringe for 20 years.
He said: "We have to think about the future, what is going to be happening next year, because next year the recession will hit enormously and we have to be prepared for this.
"The problem is that for the small venues, I don't know how we are going to survive if we don't have enough companies to come and perform and pay money to be here."
The Fringe is unique among Scottish festivals in requiring performers to foot their own costs - everything from venue hire to insurance and ticketing. But festivals which rely on public funding are also anxious.
Much of their funding comes from local authority and government budgets, which are likely to be squeezed in coming years.
On top of that, sponsorship is difficult to justify in businesses which are having to lay off staff.
Susan Rice is director of Lloyds Banking group, which sponsors a number of festival events, and last week made another 220 Scottish staff redundant.
She said: "Organisations should be concerned, some companies who sponsor will have put those numbers into their budgets for this year and they will honour the commitment.
"I think we need to see what next year brings - there may be a shifting.
"Companies may say I want to continue that link but I want to do a little less, so they might need to look to a different partner, and I think we're already seeing some of that this year.
"There may be less money around next year, that's where we get into this business of fests and other orgs planning for that and saying 'what if we have less money for a couple of years?, how do we tailor our programmes so that we don't go out of business?'."
Sir Sean Connery and Lord David Putnam at the Edinburgh International Film Festival
There have been high profile casualties too.
While T in the park might have managed a sell-out crowd, its newer sister festival - Connect - has been postponed.
And the Outsider festival - an eclectic mix of music and outdoor activities near Aviemore was also abandoned.
Its promoter Pete Irvine believes they are far from the only ones.
He said: "I think the music festivals that are purely commercial enterprises, they are not so affected.
"But for festivals that receive public funding and rely on sponsorship then it is a vulnerable time.
"I think it's going to be difficult. There are also so many festivals, so much competition for the same money, and private enterprises are not so disposed to fund these things any more. Sponsorship is going to be really tough."
One promoter who took matters into her own hands was Nica Burns, director of the Edinburgh Comedy Awards.
When sponsorship of the awards from Scotland-based Intelligent Finance ran out, she decided to invest £100,000 of her own money to keep the awards going until she could find a new sponsor.
Ms Burns said: "Money and sponsorship in the arts has to be a really good partnership and it has to fit.
"There's no point doing it on either side if it's not a successful relationship.
"And with the comedy awards we've got to be very careful that we're in bed with the right company.
"We saw what happened recently with the Edinburgh film festival where there was a huge fuss and upset over a small travel grant from the Israeli embassy.
"Arts events should not be mired in that sort of controversy, it's an unhappy experience all round.
"I want to find the right sponsor that we can be in business with for a long time and we can all of us get a lot out of it. I'm very confident we'll find the right sponsor next year."
We seem to be very resilient and we like to have a challenge
So what can festivals do? Faith Liddell director of Festivals Edinburgh - the forum for all 12 festivals in the capital - said "be prepared".
Ms Liddell said: "I think we're cautiously optimistic.
"We've got a fantastic programme, tickets are selling really well. We seem to be very resilient and we like to have a challenge.
"These are challenging economic times but we can take advantage of those opportunities - there are more domestic tourists around, the exchange rate is helping and festivals are also part of this celebratory event where people can come together and be distracted, be uplifted and also debate the great issues of the day."
Prof Joe Goldblatt, executive director of the International Centre for the Study of Planned Events at Queen Margaret University, is also optimistic.
He said: "Alternative sources of funding must be identified, such as our audience contribution transfer scheme which provides a £1 contribution per ticket sale to support festival infrastructure, improve the buildings where festivals are held and develop new opportunities for programming that the public purse, perhaps, may not be able to continue to support.
"Over the past five years New York City has generated $10.5m from a theatre restoration fee.
"It's a required fee, however, we're recommending in Edinburgh and Glasgow and Scotland and across the UK that there be a voluntary £1 contribution, which would generate tens of millions of new dollars for new festivals and allow everyone to support the arts."
The Investigation into Scotland's festivals is on BBC Radio Scotland at 0900 BST on Monday. It will also be available on the BBC iplayer.
This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.