The Impact of AirBnb on Hotels and Hospitality Industry | By Ahmed Mahmoud

The Impact of AirBnb on Hotels and Hospitality Industry | By Ahmed Mahmoud


The emergence of multi-sided technology platforms, collectively known as the “sharing economy”, has enabled individuals to collaboratively make use of under-utilized inventory via fee-based sharing. Consumers have so far enthusiastically adopted the services offered by firms such as Airbnb, Uber, Lyft and TaskRabbit. The rapid growth of peer-to-peer platforms has been aided by their ability to scale supply in a near frictionless manner as well as the rich selection of goods and services they have on offer. As an example, Airbnb, a provider of travel accommodation and a pioneer of the sharing economy, has served over 30 million guests since it was founded in 2008. Although Airbnb remains privately held, its valuation of over $10 billion now exceeds that of well-established global hotel chains like Hyatt. Yet incumbent firms, despite both facing higher marginal costs and offering less personalized products than peer-to-peer platforms, have mostly downplayed competition from platforms like Airbnb

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