The rise of Airbnb and other short-stay accommodation options is dividing tourist towns across Australia, with some arguing it creates healthy competition and boosts visitor numbers, while hoteliers demand unregistered holiday homes be shut down.

As a leading peer-to-peer (P2P) accommodation platform, Airbnb is continually evolving to provide better services. By using Airbnb, consumers benefit from cost-savings, authentic experience, social interactions and home-like facilities. Nevertheless, Airbnb also yields issues that pose threats to consumers due to its unique supply side, i.e. individual hosts who have spare beds, rooms or entire apartments/houses.

The first issue is the uncertainty associated with the quality of the P2P accommodation service. Individual providers may not be well trained which can lead to significant variability in the service performance and the quality of accommodation. For example, the level of helpfulness of hosts can range from unhelpful to very helpful, akin to “rolling the dice” when picking the right host for consumers. Airbnb accommodation is not as professional as conventional hotels, and sometimes even safety and privacy cannot be guaranteed. The news of hidden cameras, for instance, has raised a concern of privacy to stay in such type of accommodation.

Another issue is related to Airbnb policies, such as the cancellation policy. To illustrate, a tourist who has navigated the website, made a booking decision, travelled a long way, may end up with no place to stay due to a last minute cancellation by the host. This can be a disaster for a tired traveller. Finally, the mutual review system of Airbnb may raise the issue of the inconsistency between online information and offline performance. It is possible, therefore, that a tourist books an unhygienic place even though all the reviews are positive. In conclusion, it is timely and necessary for Airbnb to address these issues with an aim to attract and sustain the market.


Dannie Huang, GIFT PhD candidate