Budget Chain Oyo Can Be a Nightmare for U.S. Hotel Operators Despite Its Hype
Photo Credit: An exterior view of the first Oyo-branded hotel in New York City, the Oyo Hotel JFK Airport in Queens, New York. Property execs says Oyo's technology doesn't work as promised. Skift / Dennis Schaal
Skift Take
Oyo has a hype machine to rival any brand. But beneath all of the disruption, some hotel owners complain its technology is unstable and lacks functionality, leaving them to clean up the mess. Growth for growth's sake may seem great for a unicorn-like valuation, but the hotel chain will need to grapple with flaws in its business model that can't keep pace.
New Skift Research Report: An In-Depth Look at Hotel Chain Oyo's Financials and Strategy
The criticism of Oyo raises the issue of whether the high-flying hotel brand, which like WeWork and Uber is bankrolled in part by SoftBank and has a valuation of some $10 billion, has overreached in its astounding pace of global expansion. With nearly 1 million rooms in its portfolio, Oyo may have scaled its business so fast across India, China, and the United States, among other geographies, that it just doesn't have the infrastructure and technology to make good on its lofty promises. Skift shared with Oyo the substance of the negative comments that some U.S. hotel owners leveled against the chain, and an Oyo spokesperson replied that the company is leveraging "world class technology" to improve customer experience, and boost occupancy and revenue for owners. But the spokesperson also seemed to acknowledge some of the issues that owners raised when we contacted them. "We have taken cognizance of the feedback and are addressing asset owner concerns and issues on a war footing," the Oyo spokesperson said. "Most of these seem to be from the early days. It's important to note that we have already acted on many of t