Is short-term rental tech becoming a pay-to-play market?

There’s a quiet tax happening in the short-term rental (STR) industry: a tax that is blocking innovation and stalling progress across the sector.

Over the last decade, major property management software (PMS) providers have turned access to their platforms into relentless revenue streams. They invite outside software vendors—such as pricing engines, smart-lock dashboards and cleaning apps—to integrate through their API, promising property managers access to the best, most valuable integrations on the market.

But before a single line of code is exchanged, vendors receive an invoice: a flat “onboarding” charge typically hitting five figures, alongside a mandatory slice of every future invoice, even before a booking has occurred. These fees don’t scale with company size or success; they remain fixed whether the vendor thrives or stalls.

The terminology differs (“API maintenance,” “partner certification,” “marketplace placement”), but the high costs remain consistent. These so-called “revenue share” fees bear no genuine relationship to the marginal cost of providing API access. Instead, they create barriers and distort competition.

Let’s call the charge what it is: an entrance toll, placing innovation behind a paywall. Funds that should fuel vendors’ product roadmaps, development teams and customer improvements—investments that would drive the industry forward—are being diverted straight into the pockets of PMS providers.

Startups and smaller teams suffer the most. Software vendors entering the market using limited savings, grants or modest angel investments must choose between sacrificing significant starting capital or facing exclusion from partner directories, potentially never getting off the ground at all. Regardless of how innovative their product is, how urgently property managers need it or how effectively it solves critical industry problems, the message from PMS providers is clear: Pay if you want to exist.

Imposing these fees ensures that only vendors with deep pockets, extensive resources or generous investors make it through. Even those with sufficient funding often delay or cancel product launches due to upfront costs.

The result is that innovative tools and cutting-edge features reach the market far later than they should, and the pace of innovation slows dramatically. Ultimately, the greatest harm falls on property managers and guests, the very lifeblood of this industry.

Every vendor priced out of a marketplace is one less essential feature hosts can access. Every product launch delayed is a missed opportunity to enhance guest experiences, improve operational efficiency or boost profitability. And every time a software vendor raises prices to absorb these tolls, property managers pay more, passing costs onto guests through higher nightly rates.

When hosts and property managers browse “trusted partner” marketplaces, they assume they’re seeing the full breadth of talent and innovation. In reality, they see a curated catalogue shaped by payments made behind closed doors. These directories are advertisements for partners who can afford to be there, not for partners who deliver the best value.

Defenders often point to comparisons in Big Tech. Apple’s App Store still takes a 30 % cut on digital goods (15 % for smaller developers), a practice now under global antitrust scrutiny and singled out by the U.S. Department of Justice and the U.K. Competition & Markets Authority as potentially exclusionary. Salesforce’s AppExchange levies a flat 15 % “Percentage of Net Revenue” on every paid app—a cost partners accept only because Salesforce controls a vast enterprise customer base.

In those ecosystems, the platform truly is a global distribution channel: tens or hundreds of millions of captive users. That enormous reach may justify some fee. But the STR market is orders of magnitude smaller. The average PMS neither supplies comparable distribution nor markets its partners with Apple‑level polish. Yet the tolls are proportionally just as high—sometimes higher. There’s no clear nexus between the fee and any real incremental value. 

Healthcare provides a useful contrast. For years, electronic‑health‑record vendors were infamous for charging exorbitant fees to connect third‑party apps. In 2020 the U.S. government responded: The 21st Century Cures Act’s “information‑blocking” rules cap API charges at only “reasonable, cost‑based fees,” banning practices that inhibit interoperability. The message is clear: When integration tolls stifle innovation and harm consumers, regulators intervene.

Instead of extracting revenue from integrated vendors, PMS platforms should require their software partners to pass direct, tangible benefits to the hosts and property managers they serve, such as a discount, complementary feature upgrade or extended trial.

In practice, this model delivers far more value than any revenue share cheque ever could. Hosts see immediate and measurable value and are more likely to stay loyal, upgrade plans faster and add more units under management. Vendor adoption speeds up when the barrier to entry is technical excellence, not financial endurance. More specialized apps plug in and the marketplace looks alive, with a steady flow of new tools and competitive pricing. A richer catalogue attracts new customers and, over time, this deeper engagement generates higher recurring revenue for the PMS. Everyone wins.

The irony is that PMS providers themselves thrive most when innovation is free-flowing. By placing a premium on integration, they're inadvertently suppressing the very innovation that drives their own long-term growth.

The reality remains clear: No single player can sustain growth alone. PMS providers, software vendors, property managers and guests form an interconnected chain, each relying on the health of the others. Fragmenting this ecosystem with tollbooths and paywalls doesn’t just penalize vendors; it fractures trust, weakens growth and erodes the long-term stability of the industry itself.

It’s time to drop the quiet tax of revenue sharing agreements in short-term rentals software. Let the industry thrive on innovation, and the best ideas win on merit.