Airbnb has a really convoluted process for being “transparent” with New York City

Can Airbnb get New York to trust it?
Can Airbnb get New York to trust it?
Image: Reuters / Shannon Stapleton
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Along Fifth Avenue in New York’s Flatiron District, buttressed by a Nike store and an Ann Taylor Loft, is the entrance to Civic Hall, the self-described “home for civic tech” in the city. Through the heavy front door, up a marble staircase, past a receptionist on the second floor and down a long hallway, is a small, white-walled room, lit by 11 overhead bulbs, entirely unremarkable but for one thing—its recent repurposing as Airbnb’s exclusive “New York data room.”

I arrived in this room on Wednesday, Dec. 2, shortly after reading in the New York Times that Airbnb was supplying some data on its home rentals in the five boroughs. The release followed a public pledge from Airbnb last month to offer more details on its US operations in order to “build an open and transparent community.” The handover in New York City—Airbnb’s oldest, largest, and most complex US market—was the company’s grand overture. So it was surprising to read in the Times that rather than freely distribute the information to the press, the city, or the public, Airbnb had chosen for this data to be “available only by making an appointment to visit Airbnb’s New York City office.”

Airbnb has tense relations with local governments in cities across America, but perhaps none so strained as in San Francisco and New York. On Nov. 4, Airbnb handily defeated a ballot measure in San Francisco that would have tightly regulated short-term home rentals. The outcome was a blow to housing activists and regulators in San Francisco, but also to their counterparts in New York, who have clashed with Airbnb over its slow creep into the city’s housing stock and repeated refusals to turn over data on hosts whose rentals violate local laws. Home-sharing skeptics winced. Airbnb, a $25.5 billion giant that spent more than $8 million lobbying against the San Francisco ballot measure, declared its platform “a movement.” The following day, Airbnb announced plans to organize its hosts in 100 cities.

And then, one week later, Airbnb abruptly took a more conciliatory tone. On Nov. 11, it introduced the Airbnb Community Compact—a four-page document of “core principles” for engaging at the local level. “We are 100 percent committed to being constructive partners with regulatory agencies and policymakers,” Airbnb wrote on its blog.

The compact promises transparency and cooperation, but does so in largely general and unspecific terms. It lays out a set of principles that, if not upheld, will only fuel critics who claim Airbnb deliberately ignores laws and obfuscates data around its most pernicious users. The compact was the entire premise for Airbnb’s long-awaited release of data on home-sharing in New York City. What the compact didn’t seem to explain was the rigmarole for seeing that data—the appointment, the trip to Civic Hall, the white-walled room with spreadsheets displayed on Airbnb laptops, which visitors were instructed that they could view and take notes on, but not photograph, screenshot, or otherwise copy.

Still, the compact is the first thing Wrede Petersmeyer, Airbnb’s general manager for New York City, brings up when I ask why the company is providing its data in such an unusual manner.

“Well,” Petersmeyer says, “the first big step in making this compact real is to show to New York—the regulators, the public, the press—who our community actually is in the city, how they’re operating, and to dispel a lot of the myths that have been swirling around over the last few years.” The spreadsheets, he explains, are the combined effort of Airbnb’s data team, its New York business, and third parties who advised on how to provide information without compromising the privacy of Airbnb hosts. Disclose too much and an enterprising individual could figure out the names and locations of particular hosts, security experts have advised Airbnb.

“That’s what got us here today,” Petersmeyer continues, now speaking not just to me but also to the two other reporters and handful of PR people present, “in what we’re considering our New York data room, where we’re working with folks like yourselves to walk through not just the highlights of the data, but some of the raw cuts themselves, so you guys can get a sense of what’s actually going on in our community, and who’s using the platform, and to what ends.”

For the next hour, Petersmeyer talks us through this data, the highlights of which are available on the company’s blog. Over the last year, there were roughly 18,000 Airbnb hosts in New York City who rented out their entire home or apartment—something Airbnb terms an “entire space” (as opposed to a single room in a unit, or a couch in an already occupied room). Of those hosts, the vast majority in all five boroughs advertised only one or two properties. But 249 listed three or more. From November 2014 to November 2015 this tiny portion of hosts—1.4%—also took home 24% of revenue.

Airbnb likes a different framing. The company’s analysts have examined historical trends to project that, by this time next year, entire-space hosts with one or two listings will be earning 93% of revenue. Petersmeyer points out that the median host in New York makes just over $5,000 a year through Airbnb. “It’s an economic lifeline to 72% of the community,” Petersmeyer says, citing another favorite Airbnb statistic and the company’s preferred term for “supplemental income.” “But it’s not what you consider to be a highly lucrative business. This is not the type of illegal hotel activity that some folks have claimed is taking place on the platform.”

Petersmeyer is referring to a critical October 2014 report from the New York attorney general that identified a thriving community of “commercial users”—those with three or more listings—on Airbnb’s platform. What’s funny is that the numbers in Airbnb’s more recent New York data aren’t all that different. The attorney general’s report, which analyzed data on Airbnb listings from January 2010 to June 2014, obtained through a subpoena, found that the 6% of commercial hosts on Airbnb offered 36% of all private listings and collected 37% of all host revenue. (A “private listing” is either an entire space, or a private room in a rental where the host may or may not be there during the stay.) The top 12 commercial users accepted 14,655 private rentals for more than $24.2 million—about 5% of host revenue—during the same period.

The attorney general also found that the vast majority of Airbnb bookings were illegal, as state law prohibits renting out a space for less than 30 days unless the renter is also present during that time. Airbnb’s data also appears to support this. Across all of New York City, the company says 53% of hosts listing entire spaces rent them for between one and 30 days a year. Another 18% do so for 31 to 60 days. (It seems safe to assume that those won’t always be two consecutive 30-day chunks.) A spokesman for Airbnb says the company is committed to “working with policymakers and elected officials on clear, fair rules for home sharing” and “strongly oppose(s) large-scale speculators who turn dozens of apartments into illegal hotel rooms.”

The problem is that Airbnb hasn’t yet come up with a solution for identifying and removing these types of hosts from its platform, nor did it reveal their identities in the New York City data. That’s why New York City councilmember Helen Rosenthal, an outspoken critic of Airbnb, feels as though the community compact is “rhetoric with no substance behind it.”

“My hope was that they would give us the names and addresses of those individuals that are breaking the law,” Rosenthal tells me by phone. “And we did specifically talk about this—I asked them to take the most egregious lawbreakers and give us their names and addresses so the city enforcement agents could enforce the law.” Instead, Rosenthal says she saw the same tables and columns of anonymized raw data that I did in Civic Hall, just one day earlier. Rosenthal is among the members of City Council sponsoring legislation that would dramatically increase fines on New Yorkers who illegally rent out their dwellings.

“When I met with Chris Lehane (Airbnb’s recently appointed head of policy and a former Bill Clinton aide), he said flat out that he did not agree with our laws,” Rosenthal says. “I did not realize that a $25 billion company can just decide which laws they do and do not agree with.” 

Airbnb says it would like more people to come see its data and form their own conclusions about its operations. The company estimates that about two dozen people—mostly politicians and reporters—have visited thus far, but says that anyone is welcome to make an appointment, and that it plans to continue arranging meetings in Civic Hall as needed. “Everyone who’s come in has looked at slides and talked to us and heard the talking points and sound bites,” Petersmeyer says. “But what’s most important is that they then come back into this room and actually play with the data tables themselves.” For Airbnb, it’s crucial that this attempt at openness comes off as earnest, that it can dispel what it says is myth with facts.

How the public and its legislators respond in New York will be a litmus test of whether the community compact can pass muster in other cities across America. One possibility is that Airbnb’s play to New York is received as nothing but a well-staged show. The fact of the matter is that, once you got into that room in Civic Hall and saw the spreadsheets on Airbnb’s laptops, what they had to say wasn’t all that interesting. The tables were polished and the raw data was anonymized. It’s tough to say what a person could really gain from simply scrolling through the rows and columns. That attempt to guard something not clearly worth hiding is what makes it feel like the data being shared doesn’t tell the whole story.

Airbnb should be aware of this shortcoming more than anyone. The business of home-sharing—of getting hosts to rent their properties to total strangers—fundamentally relies on Airbnb’s ability to engender trust in its community. As the company says on its website, “Trust is what makes it work.” The community compact says that Airbnb is ready to extend its trust to cities, and only asks that they reciprocate. The New York data release leaves the impression that Airbnb’s trust is conditional.