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Comment by jeffreyrogers | Hacker News Reader

I think none of his claims about the cause are the real one. It's more like: Uber undercut taxis by using VC money to try to buy market share, which worked, but now they have to raise prices and less people want to use it (plus there was a demand shock caused by covid). See this with Airbnb too. They're no longer cheaper than a hotel in many cases and the experience has declined for a variety of reasons.

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> See this with Airbnb too. They're no longer cheaper than a hotel in many cases and the experience has declined for a variety of reasons.

This is such a common criticism of Airbnb. Maybe I’m an outlier but my use of Airbnb does not compete with hotels at all: e.g. renting an entire pool house with friends, a secluded cabin out in the mountains or an apartment with full kitchen and laundry for an extended stay in a city center.

The first two are outliers I'm pretty sure. All of my very best experiences with AirBnB have been of that kind, for what it's worth; VRBO is just as good for that, or at least, it used to be.

I suspect the last one is still pretty common, but/and AirBnB's meat and potatoes is short rentals in desirable neighborhoods of big cities, mostly tourist destinations.

Which is what hotels are for, and hotels don't jack up the housing market, cause problems for neighbors, and otherwise annoy the natives.

I must confess I've done my fair share of this, I was a 'digital nomad' for almost three years and it comes with the territory. I can confirm that the AirBnB experience for this use case has declined considerably relative to, say, 2014.

Many of my recent hotels stays were in units that have been recently remodeled to be suspiciously apartment-like: multiple rooms, working kitchen, laundry facilities, pet-friendly, etc.

I don't travel enough since the pandemic to know if this is a nation-wide trend, but I wouldn't be surprised if there's a solid market for ABNB-like amenities with chain-hotel consistency.

There are chains that have been doing this for decades already; see TownePlace Suites by Marriott.

I absolutely love extended stay hotels.

But also if I'm going to a national park with friends - AirBNB has unmatchable options.

Perhaps that market is too niche to justify its investors goals (I'm sure most travel is still business travels) but AirBNBs fill an amazing niche.

In my experience, TownePlace and similar brands tend to be located slightly out of the way, often in large commercial developments. Not always walkable or in the heart of where you want to be.

Anecdotally I view AirBnB as a hotel replacement but like the OP said, I've started going back to hotels because the price/quality just isn't there anymore.

You're thinking of budget hotels, but there's a smaller market of higher end "bed and breakfast" or "inn" style hotels that offer more amenities like an Airbnb but with less regulatory discretion. Those used to be way more expensive than airbnbs but now they're pretty similar. I imagine this is heavily regional though since community-level short term rental legislation is obviously driven by the desires of the specific community advocating for it.

You could rent party houses well before Airbnb existed.

If you needed a full kitchen and laundry, well, that would be the BnB, wouldn't it?

> If you needed a full kitchen and laundry, well, that would be the BnB, wouldn't it?

No, that would typically be a “vacation rental” (often, these are also available as timeshares) or an “extended stay hotel” (in-unit facilities are similar, other features and target market tend to differ as the names suggest.) A BnB (which AirBnB’s usually are not) is a “Bed and Breakfast”, which is basically a boutique hotel featuring complimentary full breakfast, usually in a shared-table setting with other guests. They are kind of (in terms of the direction of variation from typical hotels) the opposite direction of vacation rentals with full in-unit laundry and kitchen facilities.

For some historical context, I point you to Airbnb's 2008 homepage. Back when they spelled out "Bed and Breakfast" in their name.

https://twitter.com/WebDesignMuseum/status/14254929851737088...

Yeah, AirBnB definitely originally traded on the idea of the kind of hosting associated with a traditional B&B, but that was pretty typical of the exaggerated “sharing” marketing of regulation-dodging two-sided marketplaces (Uber’s “ridesharing” being the other poster boy for this,)

This initial idea was to ship air mattresses to hosts, that's where the air bit came from.

No, BnB means you get breakfast in an inn, often shared with other people you don’t know, in a place that other ppl live in. AirBNB means you have an entire place to yourself.

> AirBNB means you have an entire place to yourself.

No, it doesn't.

You’re right. That’s how I use it but I forgot thats not the only way.

That lack of distinction and plausible deniability is how the AirBnb hosts skirted around laws requiring a hotel license to use your property as a hotel.

The big difference is AirBnb ended up being a winner from covid, at least eventually.

I don't think this is right. They have to raise prices in some markets (e.g. California) to meet new regulations, sure, but some cities were already profitable pre-pandemic without money burning shenanigans.

The single largest thing that threw a wrench in the profitability projections was the pandemic, which caused two huge impacts in the supply/demand graph (the first one down when everyone stopped going out, and the second up now that things are going back to normal-ish, out-of-whack economy notwithstanding.) Uber, being a two-sided economy company, is extremely sensitive to abrupt changes in supply/demand.

There's this persistent notion here that Uber used VC money to lower prices across the board, which is ostensibly true to some extent, but the reality is a bit more nuanced in the sense that Uber operates in a hyper-local fashion, with budgeting strategies catered individually to each city, each with the end goal of eventually stopping the `money => growth` strategy and switching to a self-sustainable model (or if that can't be achieved, then GTFO of there grabbing equity on the way out, as it already has in multiple markets).

Was Airbnb ever really subsidized the way that Uber was (i.e. the host gets more than you paid?)

Yes. I was a large host in 2012, and whenever someone would cause trouble, AirBnB would pay for a Palo Alto hotel room to get them out of there. People would go full psycho just to get a free hotel room. I tried hosting again recently; it was an expensive nightmare, but probably better for their margins. Too bad because I had really enjoyed the community in those places.

I'm a host now and roughly 30% goes to AirBnB. There is both a Host Service Fee and a Guest Service Fee. They also take out taxes

And as a guest, they do jack shit when things go wrong. The best you can hope after spending hours on the phone explaining your case over and over with each new person you’re getting is that they’ll refund your money with a “good luck finding another place to sleep for tonight, you’re on your own”

Airbnb ruined so many of our vacations in the last few years that we’ve sworn to never ever use them again. It’s not worth the trouble.

And the prices are completely ridiculous now, on par or more expensive than a bona fide hotel.

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