The US hotel industry is going after Airbnb for its “arrogance”

Bring it on.
Bring it on.
Image: AP Photo/Jeff Chiu
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US hotels are waging a concerted war against Airbnb. The American Hotel and Lodging Association (AHLA), a powerful industry group, is ”set to launch a series of campaigns” that will “help garner additional media attention on Airbnb’s hypocrisy and the need to curb illegal hotels and ensure a level playing field,” according to an internal memo sent on Sept. 14 and obtained by Quartz.

The memo, addressed to “Industry Leaders,” outlines steps the AHLA is taking in San Francisco, Los Angeles, New York, and Pennsylvania—important and, in the first three cases, politically contested markets for Airbnb.

In San Francisco: “we have joined forces with [anti-Airbnb group] ShareBetter SF to launch a bus shelter and social ad campaign, running tomorrow, to underscore Airbnb’s arrogance in its hometown, which is forcing taxpayer money to go towards fighting its lawsuit against the city of San Francisco for a bill it helped draft.” Airbnb sued San Francisco in June over regulations of short-term home rentals that it had helped pass a year earlier. Those rules require hosts of short-term rentals to register with the city, but only 20% of them had complied as of this summer. Daily fines for each unregistered host can be up to $1,000.

In Los Angeles: “we participated in several public meetings with the LA City Planning Commission marking a strong show of force for our industry together with coalition partners … We’ve also created a new video tied to that social push which will drive more attention to the campaign and ask Angelenos to contact their council members in support of strong legislation.” Los Angeles is weighing rules that would legalize some short-term home rentals but also increase data-sharing requirements for Airbnb. The company has sued neighboring Santa Monica and Anaheim over their bans on short-term rentals.

In New York: “we are pushing out a social campaign reminding [New York] Governor [Andrew] Cuomo that Airbnb can’t be trusted … This remains a critically important fight.” The New York State Senate in June passed a bill that would make it illegal to list an entire home or apartment for rent—on Airbnb or anywhere else—for less than 30 days. Cuomo has until the end of the year to either sign or veto the legislation.

In Pennsylvania: “we released to press our latest Penn State data on commercial operators with a press call in advance of a hearing of the House Tourism and Recreational Development Committee taking place in York, PA.” Airbnb this summer reached an agreement to pay Pennsylvania’s 6% hotel occupancy tax on rentals of less than 30 days.

The US hotel industry has paid increased attention to Airbnb lately as the home-sharing company pushes into business travel and continues to expand its listings for everyday vacationers. Airbnb is the world’s fourth most valuable startup, behind Uber, Chinese electronics giant Xiaomi, and Chinese taxi and ride-hailing service Didi Chuxing. Its $30 billion valuation exceeds the market cap of every major hotel company.

One way hotels have tried to fight back against Airbnb is by stoking concerns that home-sharing hurts affordable housing and local communities. The AHLA has funded many studies that find Airbnb contributes to so-called illegal hotel activity. “These are cities that are right now in very heated discussions at the local level about what’s happening in cities and neighborhoods,” says Rosanna Maietta, a spokeswoman for the AHLA. “While Airbnb likes to talk about the middle-class family that’s making some extra cash, the reality is that people making the majority of the revenue on the platform are commercial operators.” 

The AHLA claims are tough to evidence nationwide, as most data on Airbnb’s host listings and revenue is either scraped or provided selectively by the company itself. That said, a 2014 report by the New York attorney general did find that 6% of Airbnb hosts in the city earned a disproportionate 37% of revenue, and accounted for 36% of bookings—results in line with the AHLA critique.

Airbnb contests the notion that commercial hosts dominate its platform. Nick Papas, a spokesman for Airbnb, said in an email that the “overwhelming majority” of Airbnb hosts share their homes “occasionally” and that “unlike the big hotel chains, Airbnb hosts keep the money they earn in the community.” Papas did not directly refute the AHLA’s claims about how revenue is distributed among hosts.