I am intrigued by the antipathy that is often expressed toward Airbnb in the very circles where technological changes is heartily approved. Much of this antipathy is centered around the issue of persons who use the service to circumvent local laws and regulations governing hotel and rental units, with the complaint being that illicit profiteers should be suitably punished and (impliedly) so should those whose services allegedly abet them. This piece makes that complaint without stating it directly dramatizing the fact that such a person is there, in the flesh, exploiting the system, while stating that Airbnb wants to deny his existence.

Legally speaking, Airbnb is like YouTube and similar services in offering a service that is perfectly legal to do in proper cases and that can be done today to the immeasurable benefit of many in ways that could not even have been dreamed of in the pre-internet age. When the service is used legally and properly, it transforms how millions of people do things in their lives and does so for the better: in YouTube's case, as an outlet for video display and in Airbnb's, as a way of helping all sorts of people make more efficient use of their residential holdings. When the service is misused, however, others can be hurt: in YouTube's case, with persons posting and potentially profiting by infringing the copyrights of others; in Airbnb's, with persons attempting to circumvent laws regulating uses of commercial rental space. In each case, there is legitimate reason for many to complain of the misuses because they hurt people and people react to being hurt, and the law has measures in place to punish the direct malefactors in various ways. Yet what does this mean, legally speaking, for the provider of a lawful and, indeed, exceedingly useful service that is seen to profit in part from the activities of those who not only use their service legally but also from those who do not.

When you get to such cases, you arrive at the intersection of law with public policy. Unless one is to bar technological progress and the change that it brings altogether, one must devise rules to address the illegal uses that are bad while preserving incentives to promote the technological progress that is good.

In the case of YouTube, this was done through DMCA, which (whatever its other problems) did a pretty good job of setting up safe harbors that enable services such as YouTube to continue to do what they do without incurring liabilities for the wrongs of malefactors while at the same time requiring them to build in safeguards to protect the rights of those who might be hurt by their wrongs. This was not an easy task and even today the courts are sorting through the frictions occurring at the edges. But, though not perfect, the law has set up fundamental rules that, in the end, have managed to curb a good number of the wrongs while enabling a worthwhile service to survive and prosper.

In the case of Airbnb, the fights are occurring at the local level and are at an early stage. As the players sort through the policy issues, though, the same sort of primary issue needs to be addressed as happened with YouTube in the video streaming area: how can the rights of victims of third-party wrongdoers be protected without barring or significantly impairing the new-found value for many in using a great new service wrought by technological advances (and, of course, by the skills and talents of those who have built the service)?

I don't know the New York rental market at all and have nothing to say about how the issue is best resolved for the various persons affected by Airbnb's service there. I sense intuitively, though, that things like "15% across-the-board tax" are innately retrograde solutions that would serve to choke the beneficial and legal side of the service. Occasional users really are not in the business of providing hotel lodgings and it is a pretty big leap to say that they should be required to pay taxes as if they were. Or to require them to be subjected to liabilities and risks in ways that hotels are. These "solutions" are really just a way of governmental regulators, should they adopt the, acting on behalf of some narrow lobbing interest or other to choke a service that benefits countless others. They are overkill and would be the same as if Congress, at the federal level, had passed laws saying that YouTube-style services should be banned because they can facilitate copyright infringement that hurts others. That sort of "solution" would have been folly in our digital age and so too would any overkill-style governmental solution affecting any beneficial and innovative technologically-driven service that can come about by linking what people have to offer with what people need to use, and that includes Airbnb. Many other such services can easily follow (the "Airbnb for food" or the "Airbnb for whatever"). Do we really want to choke off the great benefits that can come from all this just because third-party abuses can arise.

The key to all this is to deal with the abuses while preserving the values conferred by the new services. If there is antipathy toward the wrongdoers, there is no basis for directing this to the innovators themselves. Why this should be happening among those who otherwise favor technological change is something that really baffles me. I for one commend Airbnb for what they are doing and for the benefits it can bring to many. If they make fortunes out of it all, so much the better. The potential third-party abuses do need to be dealt with so that innocent people are not harmed. But they need to be dealt with in narrow ways focused on the actual problems, not in blunderbuss fashion that is short-sighted and, in the long run, harmful to us all.