I can guarantee you this is very rarely the case for hotels. Like airplane seats, the room is there, the show must go on (ie the hotel cannot close), and the ro

I can guarantee you this is very rarely the case for hotels. Like airplane seats, the room is there, the show must go on (ie the hotel cannot close), and the room costs X whether it's filled or not. If the room is not occupied, they miss out. This explains also why companies like HotelTonight (and Priceline bidding option) have such great last-minute deals. Hotels maximize occupancy by making remaining inventory available last-minute at reduced rates (without that rate being published). By the way, AirBnB's demand, according to Mr YCombo, is driven by 'the experience' vs 'the price' (but I doubt that). In NYC, the 15% hotel tax that is skipped, plus getting away with non-payment of income taxes on AirBnB revenue, plus avoiding regulations for hotel safety allows hosts to make AirBnB rooms cheaper.