The big news to hit the newstands in past weeks was of Singapore being the latest city to crackdown on alternative accommodation, leaving a noticeable fissure in Airbnb’s global profile. Singapore follows suit behind New York, Los Angeles, London and Barcelona.
While consumers are up in arms about local governments making accessibility to alternative accommodation beyond traditional hotels more difficult, it has been argued that perhaps regulations over the sharing economy are long overdue.
Kei Shibata, CEO, Venture Republic, whose meta-search business, travel.jp, recently signed a partnership agreement with Airbnb, argued, “certain rules and regulations are certainly necessary to balance out the interests of all stakeholders (including local communities, landlords, real estate owners/players, consumers, tax authorities and other types of accommodation).”
However, he did also raise the point that “it was time that rules and regulations surrounding all types of accommodation, including regular hotels are “revisited, reevaluated and restated too to ensure a level field of competition.”
Shibata made the case that hotels are fundamentally a legacy industry that should not be buffered or given protection from new forms of competition that are sprouting in the world of accommodation. Instead, surrounding rules must be scrutinised considerably, so that the industry can adapt to rapidly changing times.
Singapore is the latest city to impose private accommodation regulations, affecting companies like Airbnb
It means that both sides – private companies and governments – need to negotiate new rules, without underestimating consumer trends. While an outright ban (as in Singapore’s case) may pacify some frustrated voices, it frankly comes across as a disappointing show of how a lack of understanding and politics can slow technology’s capacity to evolve traditional industries at an incredible rate.
It runs contrary to Singapore’s claimed ambition to stand at the forefront of technological innovation. If anything, it goes to show that despite all that technology can offer, it can only deliver progress if society is really open to embracing it.
From a more economic perspective, limiting the business from fulfilling its full earning power could work to damage the sharing economy’s value in the eyes of tech investors, stunting the growth of other peer-to-peer models.
Technology companies and state bodies must collaborate to develop solutions that are in the interest of the majority, rather than working to stick to the status quo through increased regulations.
Perhaps a more successful example is in Japan’s changing restrictions over Airbnb-style accommodation laws in response to the influx of inbound visitors, particularly in anticipation of the 2020 Tokyo Olympics.
While there is inevitable backlash from traditional ryokans and smaller communities, it reflects Japan’s willingness to alter policies as the travel landscape changes.
According to Nikkei, companies are now becoming increasingly proactive to comply with prevailing legislation. For example, Airbnb unveiled plans to automatically ‘hide’ properties that offer rentals exceeding the government limit of 180 days per year. It also plans to introduce a tax for local governments and support to ensure homeowners are fully registered to act as hosts.
Nevertheless, all forms of accommodation need to consider the evolution of their home-sharing platforms and how they will fit into the shifting travel landscape.
Image credits: Bernard Spragg via Flickr