Shared-Space Providers (Airbnb) Poised to Beat Ride-Sharers (Uber)

By Steve Anderson April 28, 2016

Travel may be starting to make a bit of a comeback, as a new report from Juniper Research suggests that shared-space providers like Airbnb and WeWork are on the rise, sufficiently so to beat the revenues brought in by ride-sharers like Lyft and Uber by 2019. The new Juniper report—”Sharing Economy: Opportunities, Impacts and Disruptors 2016 – 2020”—offers insight on where these markets are headed in the short term.

The main value proposition from Airbnb and its ilk is that it can offer space often for less than the cost of a full hotel room. This gives users a whole new edge when it comes to travel opportunities, and it's posing a major new disruption to the market. Sufficient disruption, in fact, that revenues are set to reach $6.1 billion by 2019, up from around $2.3 billion in 2015. Reports point to the ease of use and financial rewards—property owners actually get a major boost here, as they're the ones mostly paid for the rooms with a bit of cash going to Airbnb—that's driving services like Airbnb and posing a real problem for the hotel industry. Facing a largely deregulated field that can sorely undercut on price, hotels will have to scramble to find either new value propositions to persuade users to come in over getting a room in a shared-space setting, or ways to cut expenses sufficiently to almost match prices.

Naturally, services like Uber won't be folding up in light of this; expansion efforts are on the table already, though in some places, meeting with resistance. Uber is having a particular problem in China, where Didi Kuaidi, a taxi-hailing firm, is currently controlling much of the market. Uber has already spent better than $1 billion, at last report, trying to crack the Chinese market, and that's not its only expansion plan. It's targeting India and Thailand as well, pushing to edge out the motorbike taxi market.

In the end, what this suggests is that people are looking more for a place to stay than a ride to get there. With air travel likely still the major front-runner for long-distance trips—the thought of sharing an Uber ride across state lines likely leaves some with cold chills—it's going to be more of a priority to find a place to stay. Throw in no shortage of people willing to make a bit of extra cash by doing nothing more than having people stay in their houses and Airbnb's edge is clear.

That's not to say there won't be plenty of call for Uber services, but that Airbnb et al are likely to outpace Uber and its ilk for some time to come. With a clearly interested market on hand and a comparatively competitive value proposition, it's not a surprise that shared spaces will be outpacing shared rides in the field for the next few years.

 

Contributing Writer

SHARE THIS ARTICLE
Related Articles

Pai Makes His Case for Title II Repeal

By: Paula Bernier    11/21/2017

FCC Chairman Ajit Pai today made clear his plans to repeal Title II net neutrality rules. The commission is expected to pass his proposal at its Dec. …

Read More

Mist Applies AI to Improve Wi-Fi

By: Paula Bernier    11/9/2017

Mist has created an AI-driven wireless platform that puts the user and his or mobile device at the heart of the wireless network. Combining machine le…

Read More

International Tech Innovation Growing, Says Consumer Technology Association

By: Doug Mohney    11/8/2017

The Consumer Technology Association (CTA) is best known for the world's largest trade event, but the organization's reach is growing far beyond the CE…

Read More

Broadcom Makes Unsolicited $130B Bid for Qualcomm

By: Paula Bernier    11/6/2017

In what could result in the biggest tech deal in history, semiconductor company Broadcom has made an offer to buy Qualcomm for a whopping $130 billion…

Read More

How Google's 'Moonshot' Could Benefit Industrial Markets

By: Kayla Matthews    10/30/2017

The term "moonshot" encapsulates the spirit of technological achievement: an accomplishment so ambitious, so improbable, that it's equivalent to sendi…

Read More