Lucky Me

Three writerly things I’m enthusiastic about at the moment.

First, my recent post In Praise of Fake Reviews has been reworked and polished thanks to the efforts of Rob Horning, and posted at The New Inquiry.

Second, I’m off to New York City next week to take part in the Digital Labor conference. I’ll be on a panel on The Future of Workers in the Sharing Economy; we each talk for about 30 minutes and then discuss. I’ll be talking in part about reputation.

Third is an article in progress, but more on that later.



Airbnb City Maps

Inspired by the (much better!) maps of Amsterdam listings, here are some of my surveys of Airbnb cities converted to Google Fusion Tables. Data is obtained to the best of my ability, and I believe it is statistically pretty good, but I can make no guarantees as to its accuracy. Always visit the actual page for any individual listing.

Out and About

Despite the slack posting here (but I do have some things I’m working on, honest), I am flattered that people still want to talk to me about sharing economy and related topics. Here are some recent posts and articles where I appear.

  • I’m going to be talking sharing with a panel of people at Personal Democracy Forum 2014. Unusually for a technology-focused conference, over half the speakers are female, which is great. The blurb for my pane; says “Defining and Debating the “Sharing Economy” (Thurs June 5, 3:30-4:30pm): Tom Slee, James Slezak, Denise Cheng, Adam Greenfield, Nancy Scola (moderator). Is there such a thing as the “sharing economy,” or are some people more interested in sharing, while others are interested in the economy? How can we usefully distinguish between “sharing economy” enterprises that empower their users and those that may actually seek to exploit them? A critic [that’s me], an advocate and an academic observer will take a close look at these questions and try to get to the bottom of what is good and what is hype about this emerging phenomenon.”
  • Terry Dawes of CanTech Letter is right. Jeremy Rifkin’s views on the future are indeed, neat, simple, and wrong.
  • Jon Zerolnik of LA-based investigative website Capital and Main interviews me about Couchsurfers and Billionaires.
  • Thanks also to Houston Davidson of the College Hill Independent for talking to me about Sharing for Money.
  • The always-excellent Nancy Scola writes about Arun Sundararajan and quotes me.
  • Hey, look! My non-earth-shattering 1988 paper with Preston McDougall on “The correspondence between Hückel theory and ab initio atomic charges in allyl ions” is now online!

No True Airbnb Host…

After months of waiting, Airbnb and the Attorney General of New York finally face each other in court this week to argue over the Attorney General’s subpoena for information on the 15,000 or so Airbnb hosts in New York City (summary at the Guardian, more opinion in the overview by Nitasha Tiku at Valleywag). There’s been a flurry of revealing activity and statements, and lots of commentary. So here’s more.

The court case is about many things. But what makes it interesting for those of us who don’t live in New York is the broader implications of the case, which include:

  • The breadth of the Attorney General’s subpoena and the proportionality of his actions. Does the subpoena blend into the general fear of government access to individual data in the light of the NSA scandals?
  • The illegality of some Airbnb rentals. If the subpoena succeeds and shows that a significant portion of Airbnb’s business is based on illegal rentals, then that’s a problem for a lot of people.
  • If Airbnb rentals are illegal, who is responsible (legally and morally)? Is it the host or Airbnb itself?
  • The validity of the law. Airbnb maintain the law is a bad law, inappropriately applied, and that the Airbnb hosts are a new class of business (“micro-entrepreneurs”) that need new rules. Does new technology render the old laws obsolete?
  • How will this affect the $10B valuation of Airbnb and its prospects for an IPO?
  • How will this affect the future of the sharing economy?

The main players are, obviously, Attorney General Eric Schneiderman and Airbnb. But other players appear on the stage, including:

  • Airbnb hosts and guests. Hosts have the most to lose if their information is handed over.
  • Democrat Senator Elizabeth Krueger. Her position on the issue (see here and today’s interview by Nancy Scola) is a bit different from that of the Attorney General, but she is broadly on the same side.
  • The technology industries and advocates. The Internet Association and the Electronic Frontier Foundation have both spoken up about the subpoena, placing themselves broadly on the Airbnb side.
  • Neighbours, landlords, tenants, and housing co-ops. These are all affected by individuals renting out apartments through Airbnb.
  • The hotel industry. While Airbnb has painted hotels as one of the villains in the fight, their role seems to me peripheral.

To start with the narrowest issue: it seems pretty clear that about 2/3 of Airbnb rentals in the city are outside the law in New York, which forbids apartment rentals of under 30 days if the owner is not present. The New York Post report is here, and is based on an affidavit by the Attorney General’s office (PDF). That affidavit is, in turn, based on an analysis of Airbnb’s business carried out by consultants Connotate for travel site Skift. Their report is more extensive than, but similar to, the analysis I carried out a while ago here. Airbnb and Peers recognize this by arguing that the law needs to be changed.

For what it’s worth, I find Elizabeth Krueger’s position on illegal rentals more reasonable than either the Attorney General’s or that of advocacy group Peers. The Attorney General gives the impression of (at least potentially, and despite avowals otherwise) going after all the hosts who have made illegal rentals. Given that law enforcement is usually complaint-based and that Airbnb has done little to warn its hosts of their responsibilities, this seems harsh. Krueger (see links above) puts Airbnb as the root of the problem—making a lot of money off hosts and letting the hosts take all the risk—and I agree with her. Airbnb may not be legally responsible, but it seems to me morally culpable.

But what if the law is just a bad, obsolete law that shouldn’t apply to Airbnb hosts anyway, which is what Airbnb has been arguing? Here the onus switches to Airbnb: has it made the case that it can do better than New York’s “bad law”? It needs to do more than say “because Technology” if it’s going to justify a change.

Most of the Airbnb case is made in its public policy blog posts (here and here), in its report on New York (here), and in its new sharing cities initiative (here). What these posts show is a remarkable lack of content, and a reliance on heartwarming words and spin that is, in the end, cheap talk.

Airbnb’s description of its own hosts is at least consistent. They repeatedly describe their “community” as “regular New Yorkers who occasionally rent out their homes”, or “regular New Yorkers just trying to make ends meet”. They emphasize that “87 percent of Airbnb hosts rent out the home they live in”. These are all phrases that invoke the “sharing economy” vision. When anything goes wrong, Airbnb refers to occasional, incredibly rare “bad apples”.

But Airbnb’s homespun language is carefully chosen. The 87% figure is the most obviously economical with the truth. It may be true as a percentage of hosts, but only about 63% of listings are single-listing hosts, and as much as anyone can tell, almost half of actual bookings are from hosts who have multiple listings. It’s not easy to get definitive answers from scraping the public web site, but Airbnb has consistently refused to challenge these numbers, and so it’s a good guess that they are not too far off the truth. They could release their own statistics if they chose, but they don’t.

Instead, they put out “reports” that have no methodology, no definitions of key terms, and about 300 words of actual text. Airbnb makes a lot of the fact that it “supports more than 4,500 jobs” but it never says what “support” means. It claims to have “generated $104 million in economic activity outside of Manhattan”, but it doesn’t say what “generated” means. This may seem like nit-picking, but it isn’t: it’s just asking for facts instead of spin.

But where things get really bad — for Airbnb hosts who drive the company’s revenue as well as for Airbnb’s claim to be a responsible provider of safe and well-managed accommodation — is in Airbnb’s slippery definition of its own “community”.

Airbnb continually claims to speak for its hosts, as in “our hosts want to pay taxes”, and repeatedly characterizes its community of “amazing” hosts as “regular” people. It also describes them as “micro-entrepreneurs”, suggesting that they are independent. But Airbnb hosts, who are asked increasingly to invest in their own property in order to put it on Airbnb’s marketplace, are precariously dependent on Airbnb’s whims in order to make money from their investment, which is not an entrepreneurial role at all. If anything goes wrong, the host gets turfed off the market without appeal. If you’re a host, how do you know if you are a “bad apple” or a “regular New Yorker”?

Most dramatically, this has happened today. After insisting for months that concerns about multiple listings were exaggerated, Airbnb today permanently removed no fewer than 2,000 New York listings from its platform – roughly 10% of the total. They claim the process has been going on for months, and that it demonstrates their responsibility. But the fact that it happened today of all days, the fact that identifying multiple listings is a trivial exercise, and the fact that the criteria for expulsion are still woefully unclear, makes it difficult to take them seriously (Jason Clampet at Skift is excellent on the removals). Here is an excerpt of Airbnb’s explanation:

But when we examined our community in New York, we found that some property managers weren’t providing a quality, local experience to guests. These hosts weren’t making their neighborhood stronger and they weren’t delivering the kind of hospitality our guests expect and deserve. In some cases, they were making communities worse, not better. We took a hard look at our community in New York to identify these hosts and we took action.

Earlier this year, we began notifying these hosts that they and their more than 2,000 listings would be permanently removed from the Airbnb community. While we are allowing these hosts to support their existing  bookings, all are now prohibited from accepting new reservations and if you search for a place to stay in New York, you won’t find these listings.

Imagine you are an Airbnb host in New York reading these words. How would you know if you are living up to Airbnb’s requirements? Are you making your neighbourhood stronger? Are you delivering the kind of hospitality your guests expect? This is a “No True Scotsman” argument: the Airbnb community is trustworthy because if you do anything Airbnb decides is wrong then you are not part of the community. The lack of clarity is remarkable and shows that they are not ready to provide the kind of security and accountability that any replacement for rentals regulation would need.

My skepticism over Airbnb’s sincerity is heightened because, apparently, one blocking point in the negotiations with New York is that (according to Clampet), “Airbnb would not agree to limits on how many listings a person could have in New York City.” It’s clear that a large number of bookings is essential to the venture capital model, and goes against the spirit of the “sharing economy” that Airbnb so consistently invokes. But it looks like they’re going where the money is. That makes them untrustworthy.

Airbnb’s evocative but meaningless cheap talk (for more, see their Shared Cities initiative) is cynical. I fear that, instead of promoting any realistic idea of sharing, Airbnb will pollute the whole idea as a consequence of the high-return venture capital model it has pursued.

Me on CBC Radio

Self-promotion alert: around 8:30 to 9am on Monday morning I’m going to be on CBC Radio’s The Current with the admirable Anna Maria Tremonti to take part in a panel discussion about “the sharing economy”.

I’ll be the grumpy one.

Sharing economy and informal economy

Earlier this month, New York University business professor Arun Sundararajan presented testimony to the Committee on Small Business of the US House of Representatives. He wants “peer-to-peer” business to be reflected in economic statistics and employment surveys.

When should the sharing economy be treated as part of the real economy, and when should it not? Are you confused? Here is a short guide for the perplexed.

When the sharing economy should be excluded from the formal economy:

  • taxation
  • regulation
  • job protection for service providers
  • platform-owner liability when things go wrong
  • limits on platform-owner freedom of action regarding their “community”
  • when a site’s design enables racial discrimination on the part of its users.

When the sharing economy should be part of the formal economy with all its protections and benefits:

  • recognition of positive economic contribution
  • legitimacy of platform-owner revenue
  • terms of service that protect the platform-owner
  • IPOs
  • when a site’s design makes racial discrimination on the part of its users less likely

I hope that is clear.