AI vs. Blood Parties: Airbnb's Experiment
As New Year's Eve 2024 approached, Airbnb Inc., a rental giant with a market cap of $89.43 billion, blocked over 63,000 bookings. Manually handling such a volume would be an almost impossible task, comparable to the legendary feat of the 300 Spartans. To analyze booking records and make decisions on whether to approve or deny potential client reservations, Airbnb Inc. turned to the power of AI.
The silent entry of "smart machines" marks the beginning of a crusade against a long-held American tradition: the raucous New Year’s parties, colloquially known as 'blood parties'. Although these gatherings typically don't result in actual bloodshed, they are infamous for their unrestrained celebrations, blaring music through the night, dancing, and the inevitable tumbling of bodies and furniture. When it comes to choosing venues for these events, private rentals have always edged out hotels, primarily due to more affordable rental prices. Despite potential damage to their properties, landlords have generally been eager to rent out their spaces for holiday festivities, factoring possible damages into their prices. But now, thanks to Airbnb’s intervention, the private sector has been largely pushed out of this market segment.
Airbnb first rolled out a temporary party ban in 2020. The restrictions, set during the Covid-2019 pandemic, brought the global restaurant business to a near halt. Yet, in the face of infection risks and potential fatalities, people still sought to indulge in life's pleasures with friends over festive gatherings.
“When the pandemic hit, many bars and clubs closed or imposed restrictions and some people began hosting parties in rental homes, including through Airbnb. This created a risk of spreading the virus at such gatherings. Therefore, we have announced a ban on parties in the interests of public health," Airbnb explains.
It's now evident that this movement is picking up pace. In just two years, the ban has evolved into a permanent fixture, particularly enforced during major holidays like Christmas, Thanksgiving, and Halloween.
Airbnb asserts that its AI system scrutinizes hundreds of account parameters before blocking a booking. Notably, it uses a client’s historical data with the platform to identify bookings deemed high-risk. The AI also tends to reject requests for short-term, one to three-night house rentals.
Additionally, AI evaluates the geographical distance of the potential renter from the booked location, operating on the assumption that parties are more likely to be planned near one’s home. It has also eliminated the possibility of making last-minute reservations, likely to prevent impromptu party plans.
Emphasizing AI's strategic role, Airbnb acquired the startup GamePlanner.AI for $200 million in November 2023. Co-founder Brian Chesky stated that while they don't aim to lead in AI research or develop proprietary LLMs, their goal is to be at the forefront of applying AI in the travel industry.
This approach is already yielding results. Last year, AI blocked 63,550 New Year’s reservations in the USA, and refused bookings to 13,200 clients in the UK and 5,400 in Australia.
When it comes to how we use technology like AI, we're focused on taking a thoughtful approach that aims to benefit Hosts, guests and neighborhoods. We're optimistic these measures will help have a positive impact for the communities we serve,says Naba Banerjee, Head of Trust and Safety at Airbnb.
Looking ahead, Airbnb plans to expand its booking block program to other countries, including Puerto Rico, Canada, the UK, France, Spain, Australia, and New Zealand. The choice of these countries hints at regions where Airbnb’s business is particularly strong, meaning these new initiatives will have significant repercussions for both property owners and the service itself.
So stay tuned, as our exploration into this topic continues.
