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Comment by jtode | Hacker News Reader

It's debatable which SV debacle is the worst, but Airbnb and Uber are probably the most baldly extractive examples; they had no long-term strategy beyond grabbing a stake in the lawlessness and attempting to own that segment somehow, forever.

These will be the first to go down as interest rates do not, because they do the opposite of creating value.

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The irony is that Airbnb and Uber were created to try and make use of spare capacity i.e. Spare rooms, floor space, extra passenger spots in people's cars.

Instead, it created an economy where people increased the amount of housing they had or bought cars dedicated to driving Uber. This seems like a hard problem to solve.

Uber isn’t causing vehicle shortages though. It’s an apples to oranges comparison.

Airbnb isn't the one limiting the supply of new housing, city hall is.

I'dsay Airbnb is several orders of magnitude worse because housing stock is generally extremely limited and most places have very low production rates.

Services like Uber have quite a few tangible benefits that put it in another category for me.

"housing stock is generally extremely limited"

Agree .. but why is something I'd love to learn

There's a nice review of a book, on Astral Codex Ten,[1] that suggests a large part of the answer is a combination of:-

a) The design of the US's government system overly privileging its judicial branch

b) Ralph Nader.

1. https://astralcodexten.substack.com/p/your-book-review-publi...

Ralph Nader is objectively a good man, and the things he's done for this country have left it unequivocally better.

This substack article is laughably bad. Seriously, blaming him for encouraging citizens to sue the government? Oh please.

This man was character assassinated enough in the early 2000s. Let him rest.

Ralph Nader will burn in hell.

Tu quoque

There's a combination of factors, of which some are:

- Holding cost of land is near 0 in most cities, so you can use it extremely unproductively without any issues. There's a Christmas tree farm in a central suburb in my city; it could easily hold a 5-story apartment block or 8 townhouses housing tens of people instead. [Solution: land value tax]

- In most Western democracies, there are significant regulatory requirements that make it more expensive to build housing. This isn't necessarily entirely bad, but it does increase the cost to build more housing, thus reducing its supply. [Solution: there's no real easy solution for this one. Some regulations are necessary, it's hard work to make the regulations really good]

- In most cities, there are restrictions on what you can build and where. Again, not always entirely bad per se, but the settings are usually dialed up to the point of absurdity. This means even if you wanted to build more housing within some suburb, you might be unable to build it densely enough to increase how many people are housed. [Solution: more flexible zoning laws to enable more freedom in what people can build on their land; if you want a standalone house, go for it, if you want a 28 story apartment block, go for it, if you want a 3-story townhouse row, go for it, if you want a work-and-live store with an apartment on top, go for it]

- Even in areas where there are fewer restrictions, e.g. new land areas opened up for development, developers are incentivised to keep the available supply of housing low to keep the price high. This means that a large development of hundreds of houses will often only release the houses 5-10 at a time, artificially reducing supply. [Solution: increase the holding price of land, aka land value tax]

I’m happy to see someone advocating LVT, it doesn’t seem to come up much in debates on housing affordability.

Reading “Progress and Poverty” really opened my eyes to how distortionary and immoral most taxation systems are.

Zoning, permitting, and property taxes (especially in California) encourage people to just sit on old properties instead of using them more efficiently.

I agree about AirBNB but Uber seems like an upgrade to taxis. Taxis were always expensive (more than Uber), filthy, and unreliable (they’d take a longer route than needed etc). Even in NYC, I still often find Uber is cheaper and easier than a taxi.

Uber doesn’t hold a candle to traditional taxis in terms of extractiveness.

They do the opposite of creating value? Are you serious? What bubble do you live in?

Not just to me but to many millions, both uber and airbnb have be almost life changing. I don't want to write long-text here so I will just say that taxis, hotels and in-person grocery shopping can die a slow and painful death and it will bring me much joy.

Uber and airbnb created value using technology by solving many pain points of consumers.

My main beef with them is how they lack transparency.

I think if they manage to remove even more humans from the loop with the right legal regulation, it would be even better for consumers and shareholders.

I disagree.

Perhaps there’s a case for Uber… having a decent app-based way to summon a ride is a net positive. But the experience is even better in European cities where Uber has successfully integrated with the local taxi system rather than competing with it.

Hotels have always been a better experience than AirBnb, and in the last few years at least, a much better price too.

And I’m glad shopping apps exist for when I’m sick or whatever, but for the common case the extra cost and hassle is strictly worse than just swinging by the store on my way home.

> Hotels have always been a better experience than AirBnb, and in the last few years at least, a much better price too.

I find AirBnb to have far more options, generally better prices, usually better rooms, almost always more amenities, often better locations, and frequently better/more personable hosts. It's completely changed travel for me.

Before AirBnb I was shoehorning my travel plans into the limitations of the hotel, but now I can have a common private space for my entire travel group, cook my own meals in a real kitchen, and have dinner on a patio or a backyard.

The hotel charges me a premium for unneeded housekeeping, bland continental breakfast, and valet parking that I won't use--this model was ripe for disruption, regulatory arbitrage aside.

I guess it depends what you're looking for.

I travel mostly for work, and I want something above all easy and reliable. I'm expensing all my meals so restaurants aren't a problem.

I hate the uncertainty of AirBNBs. They have greatly increased probability for booking issues, not being as described, weird dynamics with neighbors, and arbitrary cleanup/checkout processes.

If I was staying with others, on my own dime, for more than a few days, then yes, the calculus does change.

> But the experience is even better in European cities where Uber has successfully integrated with the local taxi system rather than competing with it.

In my very limited experience, this may also be because Uber faces far more competition in Europe. I lived in Lisbon for several months a few years ago and there were several relatively local ridesharing apps, for various definitions of "local".

> Hotels have always been a better experience than AirBnb

That is for sure not my experience - I would always rather stay in an AirBnB than some sterile, corporate hotel room.

Try staying in a hotel with two kids

>Perhaps there’s a case for Uber… having a decent app-based way to summon a ride is a net positive. But the experience is even better in European cities where Uber has successfully integrated with the local taxi system rather than competing with it.

You'll get very different answers about Uber depending on who you ask, and in what country they live.

I think all this really points to the regulation of taxis being a complete and utter failure in much of the US, especially certain large cities there.

> Hotels have always been a better experience than AirBnb, and in the last few years at least, a much better price too.

I won't repeat what I said in a sibling comment but Hotels still suck with location, appliances/furniture, square space and experience. Booking them, figuring out costs,etc... is still horrible. And most hotels nickle and dime you on so many things. Plus having to interact and deal with noisy neighbors, bad concierge, queues,key cards,etc... is horrible. If you do this with frequency I promise all this is noticable.

> And I’m glad shopping apps exist for when I’m sick or whatever, but for the common case the extra cost and hassle is strictly worse than just swinging by the store on my way home.

This is a personal thing but I hate having to go to stores. Before all these apps, that hassle alone was a big reason I was eating fastfood all the time.

Bottom line is: these apps make available experiences that are otherwise inaccessible to many people. I am afraid I would be willing to pay more to them if needed and support them with legislation/ordinance. Next to rent, these apps take mostlf my pay check now to put it in perspective.

So while your experience maybe different, I promise you, the value they have created is bigger than what even amazon and walmart have created.

I think they certainly do offer value in terms of customer experience. But behind the scenes, they rely upon unsustainable business models dependent upon Saudi oil wealth and other VC capital, while shoveling externalities back to society.

I'll just say that uber is breaking even this year and is expectes to be profitable next year:

https://finance.yahoo.com/news/uber-technologies-inc-nyse-ub...

Although they might keep choosing to re-invest or get more capital/debt.

We're just mutual randos, but let's see where we're at in two years. I think that a different set of priorities will have begun to dominate things by then.

I’m surprised people have as much of a huge problem with AirBNB as they do, VRBO has existed basically forever and is a non Silicon Valley version of the same service.

Quantity has a quality all of it's own, I suppose.

AirBnB made the market much, much larger and that coupled with QE driving house prices up made people look at the service more cynically.

Like, I generally stay in hotels now even though I would prefer AirBnB because the social consequences of AirBnB are super bad.

It's not Airbnb's fault though. If the law wants to ban short term house rentals it can. If not, it's fair game for everyone.

Banning would have to include VRBO because they do the exact same thing.

Yeah agreed. Logic tends not to get much of a look in in policy decisions though.

The social consequences of cars was "white flight" and decimation of inner cities. Super bad. But hardly a reason to avoid cars. The real cause was lack of public transportation to suburbs which is a failure of policy.

Same with airbnb, blame lawmakers for failure in policy and try to change that. Avoiding the technology/system won't change the supply/demand economics.

Yeah but I live in a world where they're not building enough houses so me in an Airbnb at the margin, increases rent for people poorer than me.

There’s other policy failures with cars like parking minimums and single family zoning, as well of lack of requirements that roads be pedestrian friendly.

> Uber and airbnb created value using technology by solving many pain points of consumers.

I don’t think this is as the USP airbnb was going for. Companies like Booking.com, trifago.com and Hotel.com existed prior to airbnb and had a pretty decent “human-less” UX.

I thought the usp of airbnb was that everyone with a place could rent it out on that platform. That should increase the supply. It worked pretty well for a while and still does so to a certain extend. Regulations make its service useless in some countries though.

I’m not sure what Uber did to improve the market but they’ve always been dearer than taxies where I’m from. I don’t mind giving a taxi central a call either…

Those sites are for hotels. Hotels suck in many ways, a mid-range airbnb has more space and amenities than high end hotel suite. I've stayed at super expensive vegas suites and dubai hotels and their TV is shit at both places. Nice bedsheet but meh beds, less space, less privacy, can't compare their kitchen or sofa to even a low end apartment airbnb. Also, this is real-estate, "location, location, location". I've stayed at several airbnb's inside or right next to national parks!

Uber? Are you kidding me? You don't remember how horrible it was getting taxis to just show up? They cost a fortune by comparison too. And every cabbie tries to cheat you. I've even used Uber for daily commute and it was cheaper than my own car! Cost aside, the reliability and user experience is much better. Now, had taxis come together and built an app to improve ux, consumer cost,increase consumer base and reduce fraud the I'll give you thar Uber would have had to compete. But man, I for one was very glad to see their medallions' value get decimated for the horrible way they treated me in the past.

> Now, had taxis come together and built an app to improve ux, consumer cost,increase consumer base and reduce fraud the I'll give you thar Uber would have had to compete

This existed, it was called Hailo and they operated a (mostly) franchise based model. Uber drove them out of business by breaking the laws and spending more than they earned.

Never heard of them till today. I remember frantically searchit for something like this because finding a yellow cab to come pick me up when stranded caused me a lot of misery.

Hailo wasn’t even used in very many cities. This is a bad argument. It never had the scale of Uber/Lyft. Not even comparable.

It was incredibly successful in the UK and Ireland. They explicitly pulled out of the US because it cost too much money for marketing.

I'm just bitter that a decent service got wiped out by a competitor setting VC money on fire.

If it was a decent service then it’d still be around. The market decided it wasn’t as useful as Uber.

Airbnbs only make sense in rural areas. Hotels are more competitive in terms of price and location inside of cities. Cities have enough to do that I don’t want to be inside of my room that much during my trip, so space and TV simply don’t matter to me.

> Airbnbs only make sense in rural areas.

Not in my experience. The competition between hosts in cities make Airbnbs a much better value vs hotels in many cases.

Even in cities, would you rather have a clean well furnished apartment with plenty of space, nice tv, nice kitchern and a nice view or a hotel? The only pro I can think of by comparison is room service and maids cleaning up or if you actually make use of concierge services.

No. Some of us like interacting with people. Your dystopian and lonely viewpoint does not resonate.

Fair enough. You're right about me wanting to avoid interacting with people, especially when tipping is involved. But keep in mind, many people travel with others and airbnb is still a better option if you want to party a bit or have kids. Can't beat a private pool at an airbnb house or to entertain guests at a fancy airbnb.

Some of us also like not having to check every lamp and decoration in a bedroom/bathroom wondering if there's hidden cameras in it placed there by the "host"

> Those sites are for hotels.

I've actually booked apartments via booking.com

Though they're not as extensively listed as on Airbnb.

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