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Why are there so many competitors in the delivery/taxi type services, but in the short term rental industry Airbnb seems to be mostly unchallenged? I would've

Why are there so many competitors in the delivery/taxi type services, but in the short term rental industry Airbnb seems to be mostly unchallenged? I would've expected to see a lot of VC money being thrown there as well, but I'm only seeing Airbnb raising their fees and actually making a profit.

bombcar 5y ago
Because if a food delivery company messes up I’m out dinner. An Uber competitor messes up in our a ride or have an uncomfortable half hour. But an Airbnb competitor messes up and maybe I have lice or worse. So the brand is worth more in that case. And they’re constrained on both ends by hotels also.
akmarinov 5y ago
Isn’t booking.com up there as well in that field?
- erik_seaberg 5y ago
  I see VRBO (Vacation Rentals by Owner) ads frequently.
Znafon 5y ago
Because when you book a car or ask for food to be delivered of it does not happen you just cancel the transaction and book another one, perhaps on another app. There is not much risk associated to this transaction and this favour the apparition of « competitors » doing the exact same thing. When you are renting a flat in another town, or country, sometimes weeks or months in advance, the risk is much higher. If upon arrival you discover you have been scammed it has a much higher impact than a delayed meal. This favour a single actor that you can trust (however bad is Airbnb, image what it would like if you had to trust a local actor in a country that you have never been, acting without respecting the regulations…). This makes the dynamics of those two types of marketplace completely different.
ec109685 5y ago
At least for Tahoe, VRBO and AirBnB have similar selection and interfaces.
KptMarchewa 5y ago
I very rarely see Airbnb that's any better than what I can find on booking and it's more expensive. Not a huge sample size, but that was true in London, Paris, Berlin and few Polish cities.
fellowniusmonk 5y ago
The history of AirBnB is very different in term of the market it entered. 1. Taxies had government enforced monopolies. Vacation rentals had practically 0 regulation. 2. The vacation rental market that already undergone a VC backed "freemarket" consolidation into a single global provider. HomeAway owned effectively everything with VRBO/VacationRentals.com/bedandbreakfast.com/abritel/stayz, etc. With "kept opposition" like flipkey and the ever present craiglist to prevent anti-trust. ---- So Taxi services have gone through these stages during Uber's life. 1. Inefficient government enforced monopoly and resulting near universally hated service 2. Defacto de-regulation (via effective non-enforcement) 3. Provider proliferation and price/economics discovery << We are still somewhere around here and step 4. 4. Market consolidation ---- Whereas AirBnB entered a market that was already at step 4. 4. Market Consolidation (HomeAway was still actively buying players that weren't flipkey during Airbnb's ascent and thus preventing proliferation.) 5. Opened new markets for urban rentals forced the larger consolidated industry players to support the same (which they did, and that makes a big difference in proliferation.) 6. Follow-on effect by driving hotel construction and driving long-term rentals up << We are here. ---- It's the difference between breaking up terrible government monopolies (Uber) and AirBnB dominating and expanding into an unregulated industry that already had large and relatively nimble players. If anything Brian Sharples and the board at HomeAway quite obviously shot themselves in the foot moving too slowly due to "innovators dilemma" around subscription vs demand pricing (and other concerns) and they left an avenue of attack open for Airbnb to get sufficient momentum w/ urban properties to steal their customer base (the homeowners) using the demand side as a cudgel.
- computator 5y ago
  > So Taxi services have gone through these stages ... Defacto de-regulation (via effective non-enforcement) Could you talk a bit more about that part? I'm glad that Uber exists, but I don't understand how they got around the "government enforced monopoly" you mentioned. Why didn't the local taxi companies go to their city government and get Uber shut down as soon as Uber starting operating in their city? Wouldn't the city government be far more receptive to the local taxi company than to an upstart 1000 miles away? Did Uber spend a fortune to fight this city by city in court? If someone told me Uber's business plan 13 years ago, I would have said it'd be shut down instantly by the local regulators.

bombcar 5y ago

Because if a food delivery company messes up I’m out dinner. An Uber competitor messes up in our a ride or have an uncomfortable half hour. But an Airbnb competitor messes up and maybe I have lice or worse. So the brand is worth more in that case. And they’re constrained on both ends by hotels also.

akmarinov 5y ago

Isn’t booking.com up there as well in that field?

erik_seaberg 5y ago
I see VRBO (Vacation Rentals by Owner) ads frequently.

Znafon 5y ago

Because when you book a car or ask for food to be delivered of it does not happen you just cancel the transaction and book another one, perhaps on another app. There is not much risk associated to this transaction and this favour the apparition of « competitors » doing the exact same thing. When you are renting a flat in another town, or country, sometimes weeks or months in advance, the risk is much higher. If upon arrival you discover you have been scammed it has a much higher impact than a delayed meal. This favour a single actor that you can trust (however bad is Airbnb, image what it would like if you had to trust a local actor in a country that you have never been, acting without respecting the regulations…). This makes the dynamics of those two types of marketplace completely different.

ec109685 5y ago

At least for Tahoe, VRBO and AirBnB have similar selection and interfaces.

KptMarchewa 5y ago

I very rarely see Airbnb that's any better than what I can find on booking and it's more expensive. Not a huge sample size, but that was true in London, Paris, Berlin and few Polish cities.

fellowniusmonk 5y ago

The history of AirBnB is very different in term of the market it entered. 1. Taxies had government enforced monopolies. Vacation rentals had practically 0 regulation. 2. The vacation rental market that already undergone a VC backed "freemarket" consolidation into a single global provider. HomeAway owned effectively everything with VRBO/VacationRentals.com/bedandbreakfast.com/abritel/stayz, etc. With "kept opposition" like flipkey and the ever present craiglist to prevent anti-trust. ---- So Taxi services have gone through these stages during Uber's life. 1. Inefficient government enforced monopoly and resulting near universally hated service 2. Defacto de-regulation (via effective non-enforcement) 3. Provider proliferation and price/economics discovery << We are still somewhere around here and step 4. 4. Market consolidation ---- Whereas AirBnB entered a market that was already at step 4. 4. Market Consolidation (HomeAway was still actively buying players that weren't flipkey during Airbnb's ascent and thus preventing proliferation.) 5. Opened new markets for urban rentals forced the larger consolidated industry players to support the same (which they did, and that makes a big difference in proliferation.) 6. Follow-on effect by driving hotel construction and driving long-term rentals up << We are here. ---- It's the difference between breaking up terrible government monopolies (Uber) and AirBnB dominating and expanding into an unregulated industry that already had large and relatively nimble players. If anything Brian Sharples and the board at HomeAway quite obviously shot themselves in the foot moving too slowly due to "innovators dilemma" around subscription vs demand pricing (and other concerns) and they left an avenue of attack open for Airbnb to get sufficient momentum w/ urban properties to steal their customer base (the homeowners) using the demand side as a cudgel.

computator 5y ago
> So Taxi services have gone through these stages ... Defacto de-regulation (via effective non-enforcement) Could you talk a bit more about that part? I'm glad that Uber exists, but I don't understand how they got around the "government enforced monopoly" you mentioned. Why didn't the local taxi companies go to their city government and get Uber shut down as soon as Uber starting operating in their city? Wouldn't the city government be far more receptive to the local taxi company than to an upstart 1000 miles away? Did Uber spend a fortune to fight this city by city in court? If someone told me Uber's business plan 13 years ago, I would have said it'd be shut down instantly by the local regulators.