Airbnb is a website for people to
list, find, and rent temporary housing. It has over 1,500,000 listings in
34,000 cities and 190 countries.
Airbnb is the most notable
company of the newly-created “peer-to-peer property rental industry,” which
emerged in the beginning of the 21st century as a part of the
sharing economy. With the Internet as a foundation, most industries in the
sharing economy have the same core characteristic: a website or online platform
that connects two different parties, one that wants to obtain some service for
a given period of time, and the other that owns the wanted service or product.
In this case, Airbnb serves as the middle point that matches owners of housing
space and people who want to obtain temporary housing.
Two of the more notable competitors
to Airbnb in the peer-to-peer property rental space are HomeAway and VRBO,
owned by Expedia.com, and VacationRentals.com. Before Airbnb, these companies
used the same revenue model for 15 years – property owners would buy annual
subscriptions to several individual vacation rental websites, while some hosts
would pay premium prices for “upgraded” listings to improve their visibility.
By contrast, Airbnb charges nothing for property owners to post their spaces
and takes fees only when bookings are confirmed. HomeAway responded by offering
a pay-per-booking option, but choosing this puts that property at the bottom of
search listings. While VRBO and VacationRentals do not have an IP portfolio,
HomeAway currently owns five published patents that relate to the presentation
and graphing of social data, systems for organizing transaction data, and the
correlation of reservations with payment operations. HomeAway seems to own
patents that relate very closely to Airbnb’s core functionalities, so this poses a risk to
the company.
From the perspective of Airbnb,
it should continue to bolster its IP portfolio by patenting the core components
of its business model and some of its novel and non-obvious software
innovations that relate to the search, storing, and reservation of vacant
housing spaces. Potential intellectual property acquisitions include patents on
peer-to-peer algorithms and technologies, including those that do not
necessarily relate to housing. Ultimately, Airbnb should move quickly to
acquire or publish a high number of patents on each of its novel software
functionalities.
Hi Jay,
ReplyDeleteI liked reading your post about Airbnb! Framing the discussion of Airbnb within the framework of the sharing economy gives great context; it’s unbelievable to think of the recent growth of the sharing economy in so many different sectors. I liked how you differentiated Airbnb from it’s competitors - focusing on the value added for each of the different firms. I’d be curious as to how technologies like these are affecting the hotel industry. What will be the implications down the line?
Hi Jay! Great post. This was one of the longer and more detailed posts I've read. I like how you started off by giving some background as to what Airbnb does before discussing about its patents. I'm curious whether Airbnb would get into a lawsuit with major hotel companies. Although the industries are somewhat different, I think there is a possible overlap where companies like Marriot or Hyatt could take advantage of their patents.
ReplyDeleteJay. This is good post and I like your formatting. The peer-to-peer economy has certainly taken great leaps over the past few years, especially led by organizations like AirBnB. Your final suggestion for Airbnb to increase the number of its IP assets is certainly warranted as it has successfully invaded the hospitality industry and must not work to protect its growth as competition begins to ramp up. Thanks
ReplyDeleteHey Jay! I enjoyed your post because you were clear and concise in your wording and explanation. I, too, undertook research on Airbnb as part of one of my blogposts, and so it's interesting to see what others think about the same company. I thought Airbnb's 3 biggest competitors were Homeaway, 9flats, and FlipKey, and so it is also interesting to see how our researches and perspectives lead us to different competitors. I think this is because unlike Uber, whose main competitor is Lyft, Airbnb is the strongest company out there for peer-to-peer house rental and so it's is difficult to find a close second or third. I noticed that you found that HomeAway has 5 published patents, but I couldn't find them- I would appreciated if you could cite it so I could undertake more research.
ReplyDeleteNonetheless, thanks for a great post, and I look forward to reading more :)
Srushti
Hey Jay,
ReplyDeleteThanks for the really going into depth about the case. It really helped me easily understand Airbnb's current IP situation and its different options. Choosing to bolster its portfolio by patenting the unique attributes of its business model is also the recommendation I opted for. In the increasingly competitive property rental marketplace, it really needs to protect its position with more patents and further software developments.
Hi Jay! Great post. I especially liked how you compared the revenue streams of companies like Expedia and HomeAway to that of Airbnb. It would've been nice to touch on whether or not Airbnb had specific IP holdings (and if so, in what areas), but regardless it'll be interesting to see how number of patents play into the competitiveness of firms in the new sharing economy. Keep up the good work!
ReplyDelete--Aditya