Economic sharing platforms provide peer-to-peer opportunities for individuals to share resources, connecting individuals in order to achieve economic value. This essay focuses on the Airbnb short-term rental platform’s two-sided commercial model that creates economic value while improving the moderation of platforms. In particular, peer-to-peer trust relations, technological security, network effects, and platform competition can promote data security and platform moderation.
Two-Sided Commission Fee Model of Airbnb
Basic interaction model of most common two-sided platform companies © 2 by Jens Warnez is licensed under CC BY-NC-ND 4.0
The platform Airbnb allows owners and renters to trade, using peer-to-peer structures to promote trading. Airbnb has been described as “a trusted community marketplace” and the “peer-to-peer marketplace” of the sharing economy (Oskam, 2019, p. 689). When a house owner posts information about their house on the platform and the person renting the home, the platform will take a service fee from the owner. Then, when renters and property owners complete the transactions, Airbnb collects the renters’ fees. So, Airbnb receives commission fees through the two-sided model to gain benefits while promoting the sustainability of house resources in the sharing economy environment.
Even though Airbnb promotes the exchange of supplier and demander resources to create value, the network effect affects the interests of the two-sided commission fee model platform. As Streeter (2010) indicates the internet effect is social construction and is influenced by “social processes and choices” (p. 8). Airbnb creates a platform for accommodation resources, and trust between participants and platform reputations will gain positive effects. However, Airbnb’s conflict is a platform for short-term accommodation rental in the sharing economy. (John, 2016).
Lower costs for participants
Indeed, the sharing economy platform Airbnb can provide a lower cost for participants in the long term and resources can be used sustainably. As Zervas & Byers (2017) summarised peer-to-peer can provide participants with a “substitute” product and service environment, as well as providing a wide “reach” for allocating resources. For example, Airbnb has hotels, tourist accommodation and flats. Therefore, Airbnb’s two-sided model creates value for participants in the platform by sharing resources and promoting resource sustainability through a peer-to-peer structure.
The trust relations and platform reputation
The sharing economy platform peer-to-peer connects individuals to achieve a trust construct with each other and strengthen the platform’s reputation. As John (2016) describes the sharing economy’s sharing is described as “a prelapsarian state of affairs”. Airbnb’s peer-to-peer relies on the connection between house owners and renters on the platform to complete transactions. Airbnb plays a role in connecting the two sides, increasing the trust of participants and security. Even though platforms peer-to-peer can reduce the cost of entry for individuals, provide sharing services and achieve economic value. However, the standard of individual access to the platform is unlimited resulting in false services and resources managed within the platform. Van Dijck (2016) states that the single platform’s business model for profits relies on data sharing and advertisements to create economic value.
False Accommodation Information
An example of 2023 News is that Airbnb Sydney lease the accommodation where the room does not belong to the actual accommodation standard, this room was created by the owner (Borg, 2023). Airbnb allows for legal transactions between owners and renters, and owners to have legal documentation. However, the sharing economy platforms peer-to-peer ignore the authenticity of users providing resources and the standards of housing owners. Indeed, the key to the growth of sharing economy platforms is to establish an excellent reputation and participant satisfaction.
AI and Data Processing
According to 2023 AP News, the platform explained that it uses AI to cancel false listings and house cleaning fees to reduce consumer costs (Koenig, 2023). Because peer-to-peer decentralization enables individuals to connect each other directly, reducing transaction costs and ensuring the security of data processing. According to Van Dijck (2016), “data and user valuation have become popular means of monetization”.
Make a Choice
Airbnb can match suitable accommodation based on demander preference data, and participant loyalty and reputation represent the value of the platform. Therefore, sharing economy platforms are allowing individuals to create economic value on the platform at a lower cost. It is important that the platform can strengthen technical management to keep a positive reputation environment in the long term.
Security of Infrastructure Services
Platform’s infrastructure serves the participants and drives the infrastructure technologies development in the networked environment. John (2016) concludes that websites and apps in the sharing economy play an intermediary role by providing an online platform to promote resource sharing and exchange between participants. For example, participants rent out their private housing through Airbnb. As Airbnb only acts as a connector to connect users to each other and the digital resources provided by the platform. Sharing economy platforms ignore the security of technical facilities and online services in a free online environment.
The necessary of the Infrastructure
The platform’s ecosystem is not restricted to access users and works mainly through the infrastructure and network effects (John, 2016). As satellite positioning technology and navigation functions in Airbnb. As USA Today published news about Airbnb’s infrastructure features that added pet-friendly options for search filters and signature icons for properties (Diller, 2023). However, while infrastructure techniques increase the functional value, also affect the governance of data control on the platform. Because infrastructure brings indispensable value to the platform, which is the ability to generate data collection and capture data (John, 2016). Significantly the value creation of assets in a shared platform relies on infrastructure technologies. Gössling & Pumputis indicate that the infrastructure technology can determine the evaluation of data, the rules of engagement and the “forms of exchanges” (2021).
Competition and Data Security
The control of user data increases competition in the market, and data competition between similar platforms increases user choice and resource availability. According to Van Dijck (2016), the interaction between platforms and infrastructures can control data generation and data sharing across platforms. Airbnb as one of the rental accommodation platforms, can peer-to-peer to provide basic infrastructure services for such platforms. Even though the sharing economy platform peer-to-peer connects the network ecosystem with technology to strengthen the economy, importantly it promotes the normalization of technology on the platform.
Peer-to-peer Governance and Evaluation
Platforms peer-to-peer strengthens the governance legitimacy and the evaluation techniques in a sharing economy environment. As Van Dijck (2016) states the platform ecosystems on the internet reflect political ideas and economic policies. Airbnb’s short-term system is different from the traditional market. When Airbnb acts as a property business between sharing economy platforms, the limited availability of housing resources reduces market transparency. Airbnb has been criticized for disrupting the consumer direction and individual ownership power in the market (Wachsmuth & Weisler, 2018).
Tax on Short -Term Rental Platforms
The reason is that a lack of accommodation supply leads to a conflict between owners and consumers, and false data collection by the property market. In fact, government tax policies on short-term rental platforms can promote platforms to manage data and ensure peer-to-peer equity. According to ABC News (2023), Australia’s Victoria government has announced the tax on short-term rental platforms starting in 2025, charging Airbnb a 7.5 per cent tax rate. Even if the tax is fair for rental platforms, the governance market improves transparency in the short term.
legitimacy and Monitoring of platforms
However, the differences in rentals charged peer-to-peer threaten consumer power. As Wachsmuth & Weisler (2018) illustrate, the “rent gap” of online resource sharing provides opportunities to serve “local capital” through “extra-local demand”. Airbnb determines the supply of accommodation based on consumer demand and evaluates owners. Indeed, the monitoring of platforms is seen as “a norm” of technological culture and represents “critical consumer judgement cultures” (Gössling & Pumputis, 2021). Economic sharing platforms rely on a good online reputation and basic technical services as sales channels. Thus, the regulation of economic sharing platforms peer-to-peer is driven by technology and represents the legitimacy of platforms.
In conclusion, the sharing economy platform Airbnb peer-to-peer provides users with an online platform that allows individuals with free accommodation resources to share them and use them again. Airbnb peer-to-peer connects suppliers and demanders in a way that promotes trust and economic value for each other. In this way, the platform has a good reputation for protecting technical services and normative processing of user data. Lastly, creating a fair online transaction environment driven by the network ecosystem achieves resources sustainable.
Borg, Rebacca. (2023, April 27). ‘Rare’ Sydney Airbnb room receives backlash over controversial detail. News. https://www.news.com.au/travel/travel-updates/rare-sydney-airbnb-room-receives-backlash-over-controversial-detail/news-story/a6d657adf3c783829f118d9af311edec
Diller, Nathan. (2023, September 20). Airbnb’s CEO knows about scam listings: Platform adds verification icons, updates search. USA TODAY. Retrieved October 1, 2023, from https://www.usatoday.com/story/travel/2023/09/20/airbnb-verified-listings-search-filters-updates/70903407007/
Gössling, S., Larson, M., & Pumputis, A. (2021). Mutual surveillance on Airbnb. Annals of Tourism Research, 91, 103314–. https://doi.org/10.1016/j.annals.2021.103314
Koeing, David. (2023, September 21). Airbnb says it’s cracking down on fake listings and has removed 59,000 of them this year. AP News. https://apnews.com/article/airbnb-fake-listings-fees-prices-7cf770169423a2d1840141c5d78e1b22
John, Nicholas A.. The Age of Sharing, Polity Press, 2016. ProQuest Ebook Central, https://ebookcentral-proquest-com.ezproxy.library.sydney.edu.au/lib/usyd/detail.action?docID=4770940
Oskam, Jeroen A.. The Future of Airbnb and the ‘Sharing Economy’: The Collaborative Consumption of Our Cities, Channel View Publications, Limited, 2019. ProQuest Ebook Central, https://ebookcentral-proquest-com.ezproxy.library.sydney.edu.au/lib/usyd/detail.action?docID=5734498
Streeter, Thomas. The Net Effect: Romanticism, Capitalism, and the Internet, New York University Press, 2010. ProQuest Ebook Central, https://ebookcentral-proquest-com.ezproxy.library.sydney.edu.au/lib/usyd/detail.action?docID=865340
Van Dijck, José, Thomas Poell, and Martijn de Waal, The Platform Society (New York, 2018; online edn, Oxford Academic, 18 Oct. 2018), https://doi.org/10.1093/oso/9780190889760.001.0001
ABC News. (2023, September 20). Victoria to hit Airbnb and short-stay rental platforms with 7.5 per cent levy from 2025. https://www.abc.net.au/news/2023-09-20/airbnb-victorian-tax-properties-short-stay-rental/102878180
Wachsmuth, D., & Weisler, A. (2018). Airbnb and the rent gap: Gentrification through the sharing economy. Environment and Planning A: Economy and Space, 50(6), 1147–1170. https://doi.org/10.1177/0308518X18778038
ZERVAS, G., PROSERPIO, D., & BYERS, J. W. (2017). The Rise of the Sharing Economy: Estimating the Impact of Airbnb on the Hotel Industry. Journal of Marketing Research, 54(5), 687–705. http://www.jstor.org/stable/44878526
7News. (2023, June 13). Airbnb listings could be contributing to the housing crisis, NSW government examining new tax [Video]. YouTube. https://youtu.be/Q-8z2DtTrpc?si=YiY0ihHnSujb1KKf