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New Book Describes How AirBNB Influenced City Laws (backchannel.com)
"For years, Airbnb was the friendly foil to Uber, aiming to work with cities rather than against them," writes Slashdot reader mirandakatz. "But as it grew and regulatory challenges mounted, the startup had to grow fangs." She shares an excerpt from a new book called The Upstarts: How Uber, Airbnb, and the Killer Companies of the New Silicon Valley Are Changing the World.
The reality people saw often depended on where their sympathies lay. Regulators, left-wing politicians, hotel CEOs, union leaders, affordable housing advocates, and angry neighbors tired of carousing guests saw Airbnb as nothing but a rule breaker from the far-away land of arrogant, entitled billionaires. Investors, hosts, property owners struggling to make their monthly mortgage payments, travel-discount shoppers, and high-tech aficionados tended to believe in the startup with good intentions that was disrupting the stultified hospitality industry.
The book is by Brad Stone, who also wrote The Everything Store: Jeff Bezos and the Rise of Amazon. He describes how "good AirBNB" got Portland to eliminate the $4,000 permits for B&Bs by agreeing to collect lodging taxes from AirBNB hosts (and by opening a Portland call center). But his excerpt ends as "momentum was shifting" against AirBNB in New York City, as powerful hotels and their service employee unions convinced city lawmakers that legitimizing the company would be "politically radioactive" -- while the company's CEO "was going to fight for every inch of territory".
The book is by Brad Stone, who also wrote The Everything Store: Jeff Bezos and the Rise of Amazon. He describes how "good AirBNB" got Portland to eliminate the $4,000 permits for B&Bs by agreeing to collect lodging taxes from AirBNB hosts (and by opening a Portland call center). But his excerpt ends as "momentum was shifting" against AirBNB in New York City, as powerful hotels and their service employee unions convinced city lawmakers that legitimizing the company would be "politically radioactive" -- while the company's CEO "was going to fight for every inch of territory".
The problem isn't regulation or lack of it. The problem is one of classification.
How do you distinguish between someone finding out another person is going to the same place they are and agreeing to split car expenses for the trip, vs someone paying another person to drive them to a destination? Or how do you distinguish between someone finding out another person wants to visit their home town the same dates they're going to be on vacation so he agrees to rent his house, vs someone regularly renting a second home out as a business?
In the old days, running a taxi or hotel commercially required advertising, and advertising meant mass exposure (mailers, billboards, TV). That made it easy for regulators to spot who was doing these things as a business. But like music distribution, the Internet destroyed that distinction. It dropped the cost of distributing information (e.g. music, or advertising) to near zero, allowing anyone running the above businesses commercially to advertise to people directly (spam, targeted ads, craigslist, Uber/Airbnb). It's a lot harder, if not impossible, for regulators to distinguish between two people coming to a friendly arrangement, vs someone secretly running a business.
Just like with music, the Internet has changed the world. Many of the old models don't work anymore - including regulatory models. And like with music, a new regulatory model is needed. Unless you want to move to an extremely invasive regulatory system which monitors everyone's personal interactions with other people (for one, eliminating cash thus allowing all financial transactions to be traceable).