I looked down into the touch-screen display at JFK:
“Upgrade to first class for $250.”
There was no way I could justify this. I can’t afford it, frankly. But my body cried to be horizontal; my mind begged for stillness.
Done deal.
That’s how badly Inman Connect had kicked my butt. In a good way of course – like a workout that leaves you really, really sore.
After a weekend in bed, I am clear enough to sort through the week that was.
Here’s what sticks out:
Google-noia and common sense
Everyone was talking about Google. And on Thursday, Google talked back. Kinda. Sam Sebastian got on the stage to say ” almost nothing. But that’s not because Sam is evasive or even because Google’s not mindful of real estate.
It just means that many of us in the category suffer from a sort of solipsism: we expect Google to do what we do. A listings database; an MLS; a lead gen play. But it’s at once more complex and more subtle than that – and certainly less about real estate specifically than many think.
The only way to understand Google’s intention is to look at it in the larger local/mobile strategy they are pursuing. Place Pages, Near Me Now, the 7-Pack, location awareness in Google Suggest and a dozen more incremental moves to become more useful to people where they are is the goal. Will this touch real estate? Sure it will. But don’t wait for a massive and targeted real estate play along the lines of Microsoft HomeAdvisor anytime soon.
It’s all about leads (again)
That was the tagline for Real Estate Connect 2002. It would have worked this year too.
Pete Flint from Trulia and Spencer Rascoff from Zillow joined Mike Montsko from Weichert and John Reinhardt from Fillmore Real Estate on stage for a discussion about online advertising.
Where two years ago Trulia and Zillow had positioned themselves as media companies pitching things like “engagement” and “community,” they were now talking about leads, leads, leads.
And that’s perfectly fine. But it does suggest a couple things: a.), the online players are still looking for an effective means of monetizing their traffic, and b) lead gen, done right, will usually beat the soft stuff on ROI for anyone (e.g. brokers, agents) on the Web.
MLS “mouths to feed”
I interviewed Marty Frame and Dale Ross from the RPR during Friday’s general session. They both did a really good job explaining what they are and are not doing. There were no major announcements, but I hadn’t expected any.
However Dale did say something worth noting in response to the following question:
“Everyone’s afraid that the RPR will become a national MLS and you have adamantly and credibly denied that this is your plan – but why not just go for it?”
He explained in his answer that it would take hundreds of millions of dollars and thousands of employees – an MLS Marshall Plan – to pull this off.
Fair enough.
Then he said that there were also “mouths to feed” within local MLSs.
He’s right of course. Lots of paychecks depend on preserving the current MLS system. He just said it openly, which was unusual.
Of course, we cannot expect people to do anything other than work to preserve their jobs. But the fact that the MLS world often looks to those not within its ranks like a Realtor-funded jobs program is ignored at great peril. Sooner or later, it’s going to ignite change.
Mike Wurzer gave voice to those who reject the view that the MLS space is overdue for a system reboot. He makes some really good points. But my beef with the MLS world is not that there are too many MLSs; in my mind the problem is that there are too few MLSs willing to give up a measure of control for the sake of a more efficient marketplace. I also think it’s premature, less than two years after the settlement of an antitrust suit brought by the federal government, to assume or assert that there’s competitive vitality in this industry.
There will be disagreements stemming from this event all year long.
Mobile
Mobile is a baby we all stand over, cooing. It’s wondrous and we know it will mature into something important. We just can’t quite visualize it yet.
So I won’t bore you with “mobile is huge” commentary. Instead, I will highlight a couple debates that were circulating at the show that I found to be important.
The first was the assertion, made by many, that the days of the native app are numbered. The argument goes something like this: building native apps takes a lot of time, a lot of money and requires a different build for every platform. A browser-based app is a build once, distribute (nearly) everywhere proposition. And the UX differences between native and brower-based apps are shrinking.
Others argue that the delta between a native app experience and that which you can get in a browser is still big enough to make a difference, the distribution opportunities offered by the iPhone App Store and the Android Market are irresistible, and that apps are the future of search.
I’m not sure who’s right. But this stuff needs to be thrown against your objectives as you contemplate your mobile strategy for 2010 and beyond.
Secondly, people were starting to talk in detail about monetizing all those mobile users. If mobile is going to be as big as most people claim it is, then as much thought needs to be put into making real estate mobile experiences attractive to advertisers on this platform as was poured into their big-screen counterparts.
Onward
It was a great week filled with smart people, good friends and more than a few debates. And I did find just the sort of Italian restaurant I was looking for.
Kudos to the Inman Team – see you in San Francisco!
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Brian, my post was a reaction to overly broad claims like yours that “the problem is that there are too few MLSs willing to give up a measure of control for the sake of a more efficient marketplace.” Which MLSs and which measure of control are you referencing? Absent specifics, the statement is simply saying something like “MLSs suck” without acknowledging the hard work it takes to help competitors cooperate. My belief is that MLSs have achieved something wonderful in getting competitors to cooperate, and changes to that model should be made carefully and through the proofing fire of the marketplace. If the changes sought by companies like calREDD are so great, why can’t they succeed in the marketplace? Could it be that running an MLS and creating MLS software that serves brokers effectively in a given market really isn’t all that easy or clear? Everyone who wants to revolutionize the industry with true monopolies like a state or national MLS presume without evidence that the cooperation that exists today will continue, even though that cooperation began locally. Making such a presumption outside proof in the marketplace seems foolish to me, and so I reject broad claims that the MLS model is broken.
Brian, I also think it’s important to distinguish the markets we’re discussing. You mention the DOJ case over VOWs, which dealt with competition among brokers and their use of the MLS to thwart that competition. In this case, we’re talking about competition in the markets for MLS services and software. There can be little doubt that the market for MLS software is highly competitive.
In terms of the MLS, the market for a national or state MLS (apparently the desired result by reformers like Joel Singer of calREDD) is wide open to competition as it doesn’t exist today. This is the fundamental distinction between approaches like calREDD and CARETS, where CARETS creates competition and calREDD (before agreeing to join CARETS) or other statewide or national solutions that focus on one system for everyone would reduce options and competition. This is why focusing on specific solutions is critical, so that the overall call for change doesn’t blind people to thinking that anything is better than the crappy MLS systems we apparently have today.
Thank you for taking the beating. Your summary was valuable and I didn’t have to attend. When ever I go to a seminar I am so “jazzed” on the way home that I spend for the upgrade. I think better in first class.
Aloha,
Keahi
Of course It’s all about leads (again) – it will always be about leads – online, offline, all down the line. Agents and brokers are in the selling business and it all starts with a lead – someone that needs your service. I think agents should join together on one website to attract leads online so that they do not have to pay the large online sites to do it for them. Is that too easy?
Don Stewart
Agent Invitation
@ Michael
Thanks for your comments here. I sincerely appreciate them. I have been an outside admirer of your thinking and your company for a while now.
But my conclusion remains the same: the MLS system as we know it is in need of major change.
Part of our disagreement lies in our level of analysis. The fact that there are 900 MLSs nationally means little in my view. There are probably 500 pizza places in San Francisco and 500 in New York. They are numerous. They do similar things. But they do not compete. They only compete with their in-market brethren. That’s where I’m looking – within the markets. And that’s where the competitive landscape is really barren.
I also approach this as someone who has run a company that built Websites for brokers and, now, as someone who helps them think through their overall digital strategy.
What I saw then and see now is a system that makes it too difficult for brokers to innovate. “Overlapping market disorder,” frequently unimaginative leadership, and gratuitous and outdated rules present needless costs and generally get in the way of creating quality online experiences for consumers.
I talked with a large broker in Connecticut just last week who was being put through the ringer because the two MLS to which he belonged would not allow “co-mingling” of data. The result? A fragmented – and from the consumer’s perspective, totally puzzling – user experience.
The paperwork involved in setting up a simple IDX feed is in many markets a manual, time consuming process. This is changing. But too slowly.
We work with an online brokerage that – DOJ settlement notwithstanding – continues to have hurdles placed in its path.
And regarding the DOJ settlement: I recognize that it was not about MLSs directly, but rather the use of the MLS as an instrument of unfair exclusion. If there were real competition in local markets, such a tactic could not have been employed (and the DOJ would have not intervened.)
I do not discount the work that goes into maintaining cooperation among brokers in local MLSs. That is considerable.
Nor do I disagree that there is heated competition among MLS software vendors. That is undoubtedly the case. But I am not talking about software vendors: I am talking about the institutions they serve. Entrepreneurial companies compete intensely for contracts with even the most calcified institutions (e.g., the federal government.)
I don’t think we can account for the lack of change here to “crybabies” pouting on the fringes of the market. I do think that for practical purposes there are unnatural barriers to entry. Anyone in any market could indeed start a new MLS. They could also start a new political party. In theory. But there’s a difference between strong market leadership and an unnatural state of market lock-down. Entrepreneurs try to take out Google all the time, despite the odds. Your observation that there are no new entrants willing to compete against a local MLS makes my case, not yours.
So we disagree on some things. But I think we probably agree on more than a 20-minute panel discussion at a conference, or my blog post, can bring to light. I agree, for example, with your call for a national data repository. I tend to think that CARETS probably is the better path to change than CALREDD – I’m just not willing to dismiss the latter. I too fear large beauroracies.
And for the record: I think MLSs – with all of their content, all of their cooperative power, and all of their capacity for surfacing insight into housing markets – have tremendous potential. I just think it’s been stifled in a cradle of complacency that needs to be upended.
Thank you for the additional details, Brian. I don’t mind upending anything, I’m just concerned about the process by which the upending occurs and where the contents of the cart end up once their spilled. You’re right, we agree about more than we disagree. For example, I agree that simplifying IDX and VOW licensing is important, and this is something I believe will happen pretty rapidly through more agreements like Richard Renton described for North Carolina. Most important, however, is the need to standardize the data.
Where we do appear to disagree is on efforts like calREDD, which you’re willing to consider and I adamantly reject as a monopoly approach specifically designed to eliminate competition. If you think there isn’t competition now and that the lack of competition is what’s causing inefficiency, how much worse will it be with a single MLS? I can see the immediate allure of a single MLS as a way to get data standards and simplify the rules, but history has proven that such a monopoly approach will, in the long run, hurt more than it helps.
My point is made resoundingly by listening to the black-is-white-white-is-black propaganda from calREDD, the monopolist-to-be which was represented admirably by Joel Singer at Inman. According to calREDD, their system is magic and the systems they’ll replace are antiquated, and they boldly proclaim this in the face of hard facts to the contrary where fundamental features on which members rely day to day to do their work are missing from their system. These are the type of stark short-comings only a monopolist can overlook, and why sometimes the cure is far worse than the illness.
I joined my rejection of calREDD and similar monopolistic “cures” with rejection of overly broad cries against current MLSs (like those voiced by Brad during the transition between speakers and by Mr. Ross during the RPR presentation) because I believe the latter is what leads to the former. Instead of informed analysis or market-testing of solutions, we get people whipped up to toss out all those “antiquated systems” and “mouths to feed” without considering whether the proposed cure is worse than the illness.
Lastly, we agree that there is ample competition in the MLS software space and, again, where we disagree is on proposed solutions like calREDD, which inextricably join the offering of MLS and MLS system. You cannot choose one without the other, so the calREDD approach is most definitely in the competitive MLS software space. And, again, my objection is not to the competition. As I’ve said, bring it. My objection is to such competition being brought within a veil of confusion about the ultimate destination (monopoly) and without consideration of all the options (standards). So, I post to remove the confusion with facts and reveal calREDD and all similar approaches as the monopolies they in fact propose — a cure far worse than the illness. The better cure are those being successfully deployed today by real MLSs (like those in CARETS and North Carolina) that have successfully served their members for many years. Importantly, those solutions, too, will evolve over time as they are tested in the market but what’s good about them is they promote instead of frustrate competition.
Michael -
You may find this backwards, but I think CALREDD, if it succeeds, might actually make more new entrants/competition possible by providing a bigger target.
But that’s a discussion for another post.
Yep, that is backwards and contrary to their actions, which are the only facts on which we can base decisions. If calREDD intended such openness, they’d have started out with standards and an API instead of selecting a system and vending it. This also is one of the biggest struggles I have with the RPR initiative, where the focus clearly is on driving users to the RPR web site instead of providing an API on which competition can be fostered. I very much want to be positive and excited about RPR but, so far, the effort looks too much like calREDD to me.
[...] Connect conference in New York, Dale Ross, CEO of NAR’s Realtor Property Resource (RPR), was asked by Brian Boero why RPR wasn’t trying to create a national MLS. Mr. Ross initially responded with the same thing Marty Frame (RPR’s President) said during [...]