Ebay has a trust problem. The seller needs to trust the buyer will send whatever is sold. The buyer needs to trust the seller to pay.
Part of this is handled by the transaction process where the seller doesn't typically send something until paid but the buyer if unnscrupulous can always do CC chargebacks, cancel checks or the like. The buyer just has to trust the seller.
Reputation is the big part in this but is no guarantee. Actually what Ebay needs is to show the total value of buy and sell transactions separately, not just the number of transactions.
AirBnB seeks to solve these same problems with reputation.
The problem? At worst on Ebay, the buyer or seller loses 100% of the transaction's value. On AirBnB, the potential loss is many thousands time the value and can include irreparable harm (eg murder, serious assault, rape, etc).
What's more they're facilitating people doing something generally not allowed by their leases (if they rent) or by legislation or regulation. That's potentially a huge problem.
So it's fitting they set up this kind of insurance guarantee. Much like Ebay securing transactions (to some degree at least), the extra confidence in the system promotes its use.
I don't believe this is an end to AirBnB's problems however. They're simply kicked the can further down the street.
Imagine this scenario: someone rents a house through AirBnB while the owner is away. They set up a meth lab. The meth lab explodes, burning down the house, burning down 2 neighbours' houses and kills three people, two of them innocents. What a huge liability mess that would be. Who is responsible? Clearly the person who set up the meth lab are responsible but a canny lawyer will argue that AirBnB and the owner were negligent in their actions.
Ebay has a trust problem. The seller needs to trust the buyer will send whatever is sold. The buyer needs to trust the seller to pay.
Part of this is handled by the transaction process where the seller doesn't typically send something until paid but the buyer if unnscrupulous can always do CC chargebacks, cancel checks or the like. The buyer just has to trust the seller.
Reputation is the big part in this but is no guarantee. Actually what Ebay needs is to show the total value of buy and sell transactions separately, not just the number of transactions.
AirBnB seeks to solve these same problems with reputation.
The problem? At worst on Ebay, the buyer or seller loses 100% of the transaction's value. On AirBnB, the potential loss is many thousands time the value and can include irreparable harm (eg murder, serious assault, rape, etc).
What's more they're facilitating people doing something generally not allowed by their leases (if they rent) or by legislation or regulation. That's potentially a huge problem.
So it's fitting they set up this kind of insurance guarantee. Much like Ebay securing transactions (to some degree at least), the extra confidence in the system promotes its use.
I don't believe this is an end to AirBnB's problems however. They're simply kicked the can further down the street.
Imagine this scenario: someone rents a house through AirBnB while the owner is away. They set up a meth lab. The meth lab explodes, burning down the house, burning down 2 neighbours' houses and kills three people, two of them innocents. What a huge liability mess that would be. Who is responsible? Clearly the person who set up the meth lab are responsible but a canny lawyer will argue that AirBnB and the owner were negligent in their actions.