Published by LawTechie - May 22, 2013 - LawTechie

Internet lawIn another loss for e-commerce and a win for big business New York’s hotel industry, the City of New York Environmental Control Board has ruled that Airbnb is in violation of the city’s rules against unlicensed hotels. See New York City v. ABE CARREY, Violation # 035006622J (NYC Env. Ctr. Bd., May 10, 2013).

Full disclosure: I am a big fan of Airbnb. When I travel for pleasure, I like to have the ability to rent a home in a local area, versus a downtown hotel hub, where I can get a real feel for the city and its non-tourist culture. And I can’t complain about the fact that I am often pleasantly surprised by accommodations that rise to the level of a fancy hotel at a fraction of the price.

New York City’s rules against unlicensed hotels are ostensibly meant to protect consumers from getting ripped off by hotels that are not governed by any sort of licensing standard. That said, I cannot say that I have ever had a bad experience with Airbnb given that customer reviews are easily available on the site, and it is therefore very easy to limit your dealings to well-reviewed and “trusted” amateur hoteliers.

In other words, I don’t really buy the reasoning behind NYC’s rules. More likely, as it seems to be the case with most rules affecting internet innovation, these rules are meant to protect an ingrained lobby-heavy industry that suddenly finds itself threatened by the relative efficiency of tech innovation.

This ruling is unfortunate for New York’s tourist industry, and for a travelers, like myself, who are perhaps taking a risk when they purchase accommodations from an unlicensed seller, but who are otherwise willing to take that risk. This ruling if also unfortunate for New York home-owners who would have otherwise had an opportunity to realize some profit on their valuable real-estate.

LawTechie is a blog focusing on trends in tech and digital media. Areas covered include intellectual property, cyberlaw, venture capital, transactions and litigation as they relate to the emerging sectors. The blog is edited by the firm's partner Tim Bukher with contributions from the firm's experts in their respective areas of law.


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