What ABnB has demonstrated is that there is a vastly underserved market for regular travellers, who have no interest in 'having their sheets changed every day' - rather, they just want a decent and convenient space - and they can't afford the $250/night for a boring room 'corporate' rate.
If hotels and their regulations were efficient - then AirBnB would only be used what is was kind of meant for: either sharing/hosting - or - renting out fairly 'special' places that just don't fit regular criteria.
Most AirBnB stays are a matter of price and convenience.
The fact that I can stay in cities, in a decent place for less than 1/2 the cost of a hotel is what makes me hate AirBnB less than hotels and city regulators.
Something is deeply wrong with the hotel and regulatory areas there or else AirBnB wouldn't be a huge-huge thing.
A commenter below about a building that seemed to be AirBnBers ... think for a moment how even more efficient it would be if the whole dam thing were just a hotel, with a maid staff that only cleaned and changed the sheets between stays and could provide keys/keycodes. As it stands, even AirBnB is not near real 'cost efficiency' because there's so much 'little overhead' with each rental.
Not only should that building be a hotel but it should be cheaper than AirBnB! In fact, if markets were reasonably competitive AirBnB should generally be more expensive.
I understand that individual patrons don't have nearly the safety and regulatory expenses ... but it doesn't add up.
City regulators and hotel operators need to figure out a slightly different model.