Copy
Edition XXVIII |October 24, 2017
The Travel Technology Association
View this email in your browser

Monthly analysis & insight on policy issues affecting the travel technology industry

Washington, D.C.
Federal Affairs

Report: Yes, Airline Passengers Are Paying More to Fly
America’s air carriers love to tell consumers, the press, and members of Congress that the cost of buying a ticket on an airplane has never been cheaper.  They will also tell you – after being reminded that for the past decade nearly all amenities that go with purchasing a seat, including checked or carry-on bags or in-flight refreshments, have been separated from the “base fare” – that even with unbundled fees consumers are paying less than ever.  Words like “adjusted for inflation” and “cost of living” and “percentage of household income” and “passengers appreciate seeing precisely how they’re being nickeled and dimed” are used.  (Okay, maybe not the last one.) 
 
The problem is it’s simply not true.  According to a study 
released last month by the U.S. Government Accountability Office (GAO), an independent, nonpartisan agency that conducts research at the behest of Congress, “on average customers who paid for at least one checked bag paid more in total for the airfare and bag fees than they did when airfares included checked baggage.”  Air carriers claim that charging fees for optional services allows them to lower the base fare.  That’s true, says GAO, but not for the consumer-friendly reason the air carriers suggest.  GAO cites other published studies that found airlines “lower fares to appear more competitive and then make up the lost revenue when passengers pay to check bags” and “bag fees allowed airlines to increase their revenues with a much lower reduction in passenger demand than a fare increase.”
 
American consumers are unimpressed by the broad comparisons made by airlines between today’s ticket prices and those from the pre-deregulation era of the late 1970s.  They simply want to know, from search to confirmation, what it’s going to cost to get from one city to another through the air without having to buy a dry erase board to figure out which air carrier has the best deal.  Indeed, consumers’ ire with unbundled service fees stems not from their mere existence – as they have now for a full decade – but that it is so difficult to see the “all-in cost” across more than one airline.   

 

Shocker: The key to low airfares is competition Bill McGee, USA Today
L.A. should make it easier to enjoy home-sharing opportunities Gary Shapiro, Michael Beckerman, Linda Moore and Steve Shur, Los Angeles Daily News
Hotel fees rise to record high, again Danny King, Travel Weekly

JetBlue CEO Blasts Big U.S. Airlines for Wielding ‘Anti-Consumer Power’ Brian Sumers, Skift

Should you have to pay taxes to online travel sites, such as Expedia? Lawmakers say maybe Kaitlin Lange, The Indianapolis Star

U.S.A.
Short-term Rental Policy

Florida needs commonsense short-term rental policies

In an effort to stifle competition from short-term rentals and maintain their ability to price gouge consumers during compression periods, the hotel lobby is pressuring government officials in states like Florida to implement regulations that would severely restrict or ban homeowners from welcoming visitors into their private residence.

A recent piece penned by the hotel lobby on
 Florida Politics cites AirbnbWATCH Florida as a coalition of “Florida residents and commercial lodging businesses of all sizes” – “focused on the need for solutions that protect Florida’s careful balance as a tourism leader and ideal place to call home.”

In truth, it’s been well
 reported that AirbnbWATCH is actually a hotel funded front group designed to shut down short-term rentals, not the “coalition” claimed in the article.

Short-term rentals have been available across the nation for decades, but have become more popular as technology has helped make them more accessible and affordable. Technology innovators have helped to create a vibrant marketplace for travelers and property owners, expanding the travel landscape by making it easier for travelers to find and book short-term rental accommodations and providing economic benefits to communities around the world.

It is important for public policy to reflect the changing travel dynamics brought on by the popularity of short-term rentals, allowing both travelers and residents the ability to benefit from the options and flexibility that short-term rentals provide. Destructive short-term rental regulations being pushed by the hotel lobby can have the unintended consequence of limiting those benefits for both the residents and economy in Florida.

Short-term rental innovators such as Expedia’s HomeAway and VRBO platforms, Airbnb, TripAdvisor and Booking.com, are transforming the way millions around the globe travel. Not only do short-term rentals provide travelers with authentic experiences, but owners, operators and hosts act as ambassadors to the local community – sending new foot traffic to local small businesses and attractions.

Short-term rental platforms have also used their innovative technology to help assist victims in the path of deadly storms such as Irma, which caused severe damage to the state of Florida last month. Thanks to disaster relief programs managed by short-term rental platforms, those individuals and families who were displaced by the storm could find a safe place to stay at no cost. Ironically, some of the very businesses the hotel lobby advocates for were caught using the devastation caused by Hurricane Irma as an excuse to price gouge families in desperate need of help.

Multiple studies have shown that short-term rental guests stay longer and spend more than those staying in a hotel. And that spending spreads throughout the community rather than sticking to the hotel districts.

According to travel research company Phocuswright, just 10 years ago less than one in 10 leisure travelers opted for a short-term rental when traveling, but by 2016 that number had grown to nearly one in three. With this growth in popularity has come an increase in economic benefits to those owners and hosts who open their homes, as well as for the communities in which they are located.

In addition to diversifying available travel experiences, short-term rental platforms provide property owners with a new source of valuable extra income. That income is used to pay the mortgage, save for retirement, fund household improvements or pay for college.

Whether the hotel lobby likes it or not, the sharing economy is here to stay. For everyone’s benefit, it is critical for local municipalities in Florida to develop reasonable, efficient policy frameworks that ensure short-term rentals continue to thrive, protect property rights, and promotes economic growth throughout the state. A solution that deserves serious consideration in the Sunshine State is a bill (SB 188) introduced earlier this year by State Senator Greg Steube to create a statewide protection for homeowners who choose to use their property as a short-term rental.

Washington, D.C.

Steve's Corner
In Search for HQ Location, Amazon Should Consider the Tech Policy Landscape

As Amazon weighs bids from cities and states around the country who are vying to be selected as the home of their new headquarters, the company that promises to bring drone delivery to everyone must consider whether a suitor city has exhibited technology-friendly policies.  There is no better indicator of a city’s mindset toward technology and innovation than how that city has treated the sharing economy. 

Cities that have embraced ride sharing and home sharing are likely to appreciate and respect technological innovation. Conversely, cities that have enacted limiting or prohibitive policies toward new economy leaders like Uber, AirBnB, HomeAway and others should be discounted. If a city is going to prohibit homeowners from renting out their properties, what makes anyone think they will be any more accommodating to Amazon’s future innovations, whether it’s drone delivery or something we haven’t even thought of yet. 

Amazon stated that they are looking for:
  • Metro areas with more than one million people
  • A stable, business-friendly environment
  • Urban or suburban locations with the potential to attract and retain strong technical talent
  • Communities that think big and creatively when considering locations and real estate options.
Last year, Uber and Lyft left Austin, Texas, after the city imposed burdensome regulations on the ride-sharing companies. Uber and Lyft returned to Austin earlier this year only after Governor Greg Abbott signed into law a bill that puts the state – not local governments – in charge of implementing regulations on these technology innovators. Austin also imposed new regulations on home sharing, which are among the most restrictive in the country.

New York’s tax landscape toward technology platforms as well as the City’s hostile position toward both home sharing and ride sharing platforms should rule out the Empire State immediately.

To the contrary, Arizona, led by a very tech-friendly Governor Ducey, has shown a great understanding of the new economy and what it takes to make that state attractive to technology companies. Arizona recently passed legislation that ensures that home sharing remains legal statewide. At the time of passage, Governor Ducey said, “It’s time for our laws to get with the times. The sharing economy offers people great services at the tip of their finger and the click of an app. Now, Arizona leads the nation in embracing the Sharing Economy, including the growing homesharing industry. We are committed to doing everything we can to support 21st-century companies that employ Arizonans, advance the way we do business and improve the way we live. I thank Rep. Jill Norgaard, Senator Debbie Lesko, and Senator Steve Smith for making the sharing economy a priority this session.”

Well said, Governor.

Amazon take heed. All the promises built into those fancy proposals can’t hide the policy mentality of a city or state. 



Steve Shur
Travel Tech President

Washington, DC

Member Spotlight

Booking.com Launches Inaugural Technology Playmaker Awards to Recognize Achievements of Women in Technology

Booking.com has launched the first Technology Playmaker Awards aimed at celebrating women who are transforming businesses, industries, and communities through the use of technology.

Now open for entries at
 http://www.techplaymakerawards.com, the Technology Playmaker Awards include 10 categories which celebrate many aspects of technology including entrepreneurship, innovation, community impact, and technology leadership. The overall grand prize award will be awarded to the female technology leader whom the judges consider to be the most impactful individual in the European technology space. Each category winner will receive a prize of $5,900 to help them advance their business and professional goals, with the overall grand prize winner earning a $11,800 award.

Chaired by Gillian Tans, CEO of Booking.com, the judging panel will include leading figures from across the technology industry, related sectors and from Booking.com. Judges include Marili 't Hooft-Bolle, COO of WeTransfer, Ruth Chandler, Chief People Officer at Skyscanner, Jon Reynolds, CEO and Co-Founder of SwiftKey, and Maija Palmer, Digital and Communities Editor at the Financial Times.

The winners will be revealed at an awards ceremony on March 8, 2018 at the Sackler Hall of the Museum of London, where Randi Zuckerberg, Founder & CEO of Zuckerberg Media and former Director of Market Development for
 Facebook, will give the keynote address.

According to a report by the European Commission, having more women in the technology sector could boost the EU's GDP by $10 billion a year. However, women currently make up only 30% of the 7 million people working in Europe's digital sector. While the underrepresentation of women is a worldwide challenge, European tech start-ups led by women are particularly affected, with only 14.7% of European tech unicorns being founded by women compared to 17% in the US. Booking.com wants to recognize and support the European technology scene, including those women driving innovation.

The inaugural Booking.com Technology Playmaker Awards will in their first year be focused on Europe.

 
Subscribe
Like us on Facebook
Like us on Facebook
Follow us on Twitter
Follow us on Twitter
Visit us at TravelTech.org
Visit us at TravelTech.org
Copyright © 2017 The Travel Technology Association, All rights reserved.


unsubscribe from this list    update subscription preferences