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An Unbiased Perspective on the Hotels-Airbnb Fight

May 2, 2017

The following article was posted on HOTELS Magazine. The views and opinions expressed in this blog are strictly those of the author.

 

My Response to the Airbnb-AH&LA flap
By Daniel Lesser, president and CEO, LW Hospitality Advisors, New York City

As a debate topic in the lodging industry, Airbnb is a crowded field. Within the recent past, several published studies conducted by recognized firms analyzed and opined on the level of impact Airbnb is causing the lodging industry. The conclusions of each study varied dramatically.

The very public battle between the American Hotel & Lodging Association (AH&LA) and Airbnb has clearly intensified since the April 16 New York Times article, “Inside the Hotel Industry’s Plan to Combat Airbnb.” The piece revealed AH&LA’s January board meeting minutes, which detailed the organization’s strategy in lobbying for Airbnb to be subjected to a level playing field with the lodging industry. Unsurprisingly, Airbnb struck back with a salvo of efforts to rebuff AH&LA’s strategy.

Personally, I am a firm believer in a free market and capitalism, and I have never offered an opinion one way or the other relative this ongoing dispute. With this said, I do believe Airbnb’s April 17 piece “The hotel industry agenda: Punish the middle class,” and April 18 piece, “Airbnb: Fighting hotel price-gouging, saving millions for consumers,” as well as Christopher Lehane’s (head of global policy and communications for Airbnb) April 19 letter addressed to Katherine Lugar, president of the AH&LA, are disingenuous.

With almost 40 years of lodging industry experience subsequent to graduating hotel school, I can firmly state that in my opinion, price-gouging is not rampant in the sector and hotels are not desperate to allegedly continue price-gouging. To the best of my knowledge, unlike the airline industry, the lodging sector has not been the recipient of numerous class action lawsuits alleging collusion and/or price fixing.

Airbnb’s questioning of the “intellectual honesty” of the AH&LA has no factual basis. Airbnb is a privately held, for-profit company that owns no real estate, and serves as a broker/agent that receives fees from both guests and hosts. Sequoia Capital and Greylock Partners, the original financial backers of Airbnb, are venture capital firms whose fundamental ethos is to earn monetary returns on their investments.  Achieving risk adjusted investment returns on highly speculative ventures is considered to be the American dream and is commendable; however, Airbnb’s claim of being a champion of the middle class is at best, misleading.

Editor’s note: Neither Mr. Lesser nor his firm is a member of AH&LA. 



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