Monthly Archives: October 2011

CMLS Reviews New IDX Policy: Thoughts and Takeaways

I just got finished with the webex presentation put together by CMLS (Council of MLS), an altogether wonderful organization for those people who care about these arcane issues. I’m sure the recording and/or the transcript would be posted by CMLS soon enough. This is just a couple of first impression questions/thoughts.

There are three main takeaways for me from the call:

  • The new IDX Policy represents the announcement of a new doctrine for treating listing data.
  • The key need is to separate “transport” issues from “display” issues, and to restrict IDX Policy to the latter.
  • The whole thing turns on the definition of “control”.

Based on what I’m hearing, I believe this policy will be one of the most important changes in quite some time. But I’m left rather dissatisfied because the central concept — “control” — is taken for granted by a lot of people. Leaving it undefined will result in having to revisit this issue time and again by each MLS over the next couple of years.

I also believe that vast numbers of NAR Directors who vote on the IDX Policy will likely be in breach of their fiduciary duty of care and subject to personal liability if a member should decide to sue. It points to a real weakness in the whole governance model at NAR, one that NAR should act to address quickly.

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REALTOR Dues to Pay for RPR? (UPDATE: CONFIRMED! Plus More!)

 

As a blogger, rather than a “credentialed journalist” (whatever that means), I have the freedom to just pass on rumors, as long as I label them as such. Well, consider this one of those rumors I have not confirmed yet. [UPDATE] I just got a second person to confirm the rumor. Two people saying the same thing now moves this past the realm of rumor into a confirmed report. More detail below..

I’ve heard from a reliable source earlier this evening that there are some major changes afoot at NAR. The biggest upshot of the changes is that starting in 2012, portions of the dues from NAR members will go towards supporting RPR, REALTORS Federal Credit Union, and other so-called “Second Century” Initiatives. A few minutes of Googling suggests that the original Second Century Initiatives program — which included a line item for “The creation of a national gateway for real estate information, not a national MLS” — was funded by a $16 increase in dues in 2008.

But from the start, RPR was presented as a wholly-owned for-profit business unit of NAR that would be self-sustaining, after the initial investment of roughly $25 million to buy the Cyberhomes assets from LPS and a few million for LPS data. The idea was that the data generated by RPR would be very valuable when sold to financial institutions, government agencies, and the like, and the operation would throw off enough cash not only to continue providing the system to REALTORS at no charge, but also to generate enough profit to pay back NAR.

For reference, here’s a report of a Q&A session with Dale Ross, CEO of RPR, back in March of 2010:

Why should Second Century need to be paid back?

NAR’s Second Century fund is a venture capital fund which must paid back for its investments. However, that’s not the source of RPR’s funding. RPR money comes from an NAR technology fund set up with $100 million fund (from investments); NAR’s Finance Committee stipulated that monies must be paid back to replenish fund.

Since you’re providing RPR for free, where is money coming from? What happens if your revenue models are way off?

Three scenarios: app doesn’t work, we shut down; app works and rev model works, win-win; app works but rev model off. We project we’ll need $50 million/yr to run it… if it is valuable and not generating cash, we’ll figure up another funding source. If members want it and NAR Directors decide that is best way, that could be a member dues increase. I have never seen pro formas work; I have pushed the numbers around based on a 36-month breakeven. We’ll see. (Underline added for emphasis)

Well, if the rumors that member dues will start paying for RPR starting 2012 are true, then I’m gonna take a wild stab and suggest that the 36-month pro formas were way optimistic. Since we’re looking at a dues increase in two years (launch in 2009, dues funding decision in 2011 to take place in 2012) to support RPR.

A few questions arise. The first of which is, “So uh, is this true?” I’d love for anyone who can confirm or deny the rumor. Please feel free to contact me privately via email, twitter, Facebook, phone, whatever. My contact information is on the About page. More questions follow, all of which assume this rumor of dues funding for RPR and other Second Century Initiatives is indeed true.

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Franchise IDX Is Dead! Long Live Franchise IDX!

At first glance, the biggest change in the new IDX Policy to be proposed at NAR Anaheim is that it removes entirely the section allowing Franchise IDX. The entire section is struck.

There will be much rejoicing in the anti-Franchise IDX partisans, and much gnashing of teeth in parts of New Jersey, Texas, Colorado, and elsewhere. Except that both the rejoicing and the gnashing will be premature. Naturally, there will be differences of opinion on the subject, but I do believe that much like royal succession, the death of the old king results immediately in the new king taking power.

The valuable lesson that the Franchises will have learned from this whole affair is not to ask NAR for permission before spending millions of dollars on a new approach to listing data. That does, of course, concern me, but let’s delve into the analysis first.

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On Turning 40

There was a time when I thought 40 was the end. I was probably 19 or so, drunk on the peculiar poetry of youth, philosophical in the way that only the semi-mature can be, and caught in the strange shadowlands between the unbounded world-is-your-oyster optimism and the soul-killing despair at the evils of the world.

40? Might as well be dead.

All young men, perhaps, wish to be Achilles: heroic, strong, beautiful, foolhardy, passionate, burning like a flame, and passing on in the flower of their youth. The smarter and luckier of us perhaps find our way to becoming Odysseus: canny, wise, old, and finding happiness in the simple joys of hearth and home.

So here I am at the magical age. The day doesn’t feel any different from any other day. The heavens did not open up with significant signs. The earth did not move, since I don’t live in California. Or Washington DC. But I can’t help but reflect on a few things, especially with literally dozens of people on Facebook wishing me a happy birthday. Consider this my heartfelt thanks to all of you.

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It’s All About “Control”: The New IDX Policy Proposal

Business and travel have really kept me away from the blog, but… since I have a few days at home, I did want to write about the new IDX Policy that will be proposed at NAR Anaheim next month. I’ve managed to obtain a copy of the proposal through my sources (thank you guys, you know who you are!) and… there be some interesting things in it.

The big news, as many have already heard, is that the Franchise IDX policy will be repealed in its entirety. The overall thrust of the proposal appears to be one aimed at restoring the status quo ante. But the way the proposal goes about it is… interesting. Let’s dive in.

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