Last week, Airbnb acquired HotelTonight, the wildly popular last-minute booking app, and while both companies are staying mum on their grand plans, this is likely just another step toward accommodations domination.
Acquisitions like this aren’t necessarily a good thing, but this one just might be a boon for travelers wanting to compare all types of accommodations in a single app or who are planning on booking stays in multiple types of lodging—say an Airstream one night, a boutique hotel the next—all in one place. But we’ll break it all down for you.
Let’s Start with a Brief History of Airbnb
Airbnb began in 2007 in San Francisco as a way for a few broke roommates to make a some extra bucks by renting out a room in their house equipped with air mattresses (hence the name). The website and app evolved, allowing people to rent and book rooms, homes, and even backyard tree houses when their owners weren’t using them. Today it’s a massive business with over 5 million places to stay in 191 countries.
Over the past several years the company has continued to diversify, adding Experiences in 2016, which allows users to book activities like bike excursions, surf lessons, and city tours. In 2018, it also added boutique hotels to its catalogue, as well as Airbnb Plus for luxury accommodations and Airbnb for Work, which allows you to book business travel accommodations, meeting spaces, and team experiences.
Remind Me, What’s HotelTonight exactly?
HotelTonight is a slick discount-hotel booking app, offering cut-rate room prices at nice hotels—pretty much all three stars and up—in most major cities. Founded in 2010, the company began by partnering with hotels to offer unsold rooms for cheap, but in 2017 it expanded to allow customers to book 100 days in advance, making them a solid competitor to Booking, Expedia, Priceline, and other sites.
All hotels listed on HotelTonight are vetted with rooms categorized by type—such as Luxe, Hip, Charming, or Basic—making it easy to find the vibe you’re looking for. Its rewards program also provides additional discounts.
Why Would Airbnb Acquire HotelTonight?
From legal fights with cities and vacation-rental companies to negative press about its assualt on local long-term-rental markets, Airbnb has seen its share of pushback over the years. This expansion into more traditional lodging could be a safeguard against the threat of regulations capping short-term rentals, though Airbnb declined to comment on specifics around whether this influenced the purchase.
But mainly it’s an opportunity to tap into the growing hotel market: there’s still a vast segment of people who prefer hotel amenities, aren’t comfortable sleeping in strangers’ homes, or simply don’t want to deal with the hassle of coordinating with hosts. A recent study found that millennials prefer full-service hotels to short-term apartment rentals by a margin of more than two to one.
So, What Changes Will I See?
According to the companies, not much any time soon. In an email response, an Airbnb spokesperson said, “Over time, we will welcome select boutique HotelTonight rooms that match our hotel standards onto Airbnb.” He referenced Surfhouse Boutique Motel, an eight-room inn in Encinitas, California, run by a former home host who offers surf lessons for guests.
Airbnb maintains that each company will remain separate entities for the near future, saying that guests might just be invited to search for accommodations on HotelTonight if they can’t find a place to stay on Airbnb. But don’t expect that to last. According to Airbnb CEO Brian Chesky, the acquisition is “a big part of building an end-to-end travel platform.”
Clearly this merger helps transition the company toward a one-stop shop for all things travel, and with Airbnb’s recent hire of the former chief executive of Virgin America, maybe even expansion into the transportation sector as well. Then perhaps it will even add services like last-minute campsites, camper-van rentals, and super-discounted adventure trips. Or maybe that’s just dreaming.