Challenges
In the home sharing sector, some of the trends and opportunities, coupled with a Web 2.0 approach to the provision of online services, have already enabled a handful of corporations to grow to market caps of approximately US$100 billion, gathering millions of hosts and guests and processing millions of daily bookings. This growth, however, led to the centralization and near monopolization of a once inherently decentralized ecosystem and resulted in problems such as:
  • Intermediation: their platforms insert themselves as "middle-entities" between hosts and guests, communication is controlled and restricted, and the inherent peer-to-peer experience of home sharing is compromised.
  • Exorbitant fees: at up to 20% of the total booking cost, their fees appear to be more a result of their near monopolies than of the actual value of their services.
  • Extraction of value arising from synergy: even though most of the value that their platforms bring to society comes from the network effects that originate from large numbers of hosts and guests joining the platform, all the fee revenue goes to the corporations and nothing is distributed to the hosts and guests.
  • Partiality in dispute resolution: there is a growing perception that they take a partial (and, hosts would say, guest-centric) approach in dispute resolution and policies, regardless of a user's booking volume, rating or reviews.
  • Inadequacy of benefits for special statuses: users feel that achieving a special status as a host or guest within the platform is not worth the benefits that the special status brings.
  • Data opacity: as usual with Web 2.0 solutions, data is opaque and at the hands of the platform owners only.
As a result of the issues listed above, the trust between hosts (the supply side) and guests (the demand side) as well as towards the corporations and their intermediation platforms themselves has been eroded.
Last modified 18d ago
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