More on Trim Tab, RPR, AMP and the Future of MLS Technology

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I see… mass customization of the MLS!

Now that I’ve been liberated from some of my confidentiality constraints (see my previous post, which required permission from various companies I had non-disclosure agreements with, as well as permission from a client to discuss work I had done for them), I can opine more freely about the topic of RPR, Advanced Multi-List Platform (“AMP”), and the future of MLS technology.

Let’s start by a fair criticism of RPR leveled by a level-headed guy. Brian Boero of 1000watt, emerged as a reluctant critic last Friday, writing this in his post “Friday Flash: The Last RPR Critic“:

RPR is going to get into the business of providing MLS “Back-end” services – the database/data management/heavy lifting sort of stuff – so that more MLSs and MLS subscribers can implement their own “front-end of choice.”

The bottom line is that a lot of money has been spent on an initiative for which the market has provided no convincing validation. And now it seems poised to expand into an entirely new dimension.

I don’t get it. I really, honestly, don’t. It was a noble idea put forth by well-meaning, intelligent people. But now it seems to me like the driving force is saving face, not saving member dollars.

I think this is a very fair criticism, if what you assume RPR is doing is pivoting to becoming a MLS vendor. Since I believe (well, hope, since I’m no longer advising RPR) that RPR is doing something completely different, I think people should take another look at least at the concept of AMP.

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Project Trim Tab: From Dream to Reality

[NOTE: This is a post I wrote for a client, SIRMLS, and decided to cross-post to my blog because it tells so much of my personal involvement in it. Thanks to Tim Dain and to SIRMLS for the opportunity to tell the story, and granting me permission to cross-post to my blog.]

Project Trim Tab Team

Has it been a full year already?

“Something hit me very hard once, thinking about what one little man could do. Think of the Queen Mary — the whole ship goes by and then comes the rudder. And there’s a tiny thing at the edge of the rudder called a trim tab.

It’s a miniature rudder. Just moving the little trim tab builds a low pressure that pulls the rudder around. Takes almost no effort at all. So I said that the little individual can be a trim tab. Society thinks it’s going right by you, that it’s left you altogether. But if you’re doing dynamic things mentally, the fact is that you can just put your foot out like that and the whole big ship of state is going to go.

So I said, call me Trim Tab.”

— Buckminster Fuller

Introduction

The dream of fundamentally improving the MLS technology platform has been one that the industry has talked about for years. We have seen a surge in credit-taking amongst the “thought leaders” within the industry in recent weeks, as RPR has started to shed light on their Advanced Multi-List Platform, aka AMP™. But the concept of a flexible MLS, powered by modern API’s (Application Programming Interface), which allows for flexibility and innovation has been around since at least the mid 2000’s when technology companies like Google, Facebook, and Salesforce debuted the concept of API’s and “mashups”.

As is said, success has many fathers. But in this case, many of those were absentee dads at best. The real story of what is possibly the biggest advance in the MLS industry since the advent of the Internet itself cannot be told without mentioning the central role of SIRMLS.

As I was the author and architect of this overall effort, I know better than most just how valuable SIRMLS and its leadership have been, and remain. I know that we would not be discussing AMP, RPR, and the overall concept of the modular MLS had it not been for SIRMLS, its Executive Director Tim Dain, the Presidents Brad Krueger, Rick Lauschke, and Lindsey Egner and the Boards they led. Without the courage to take risks, to support, and to invest in moving forward when everyone else wanted to wait and see, there would be no story to tell.

We thought it was worth laying out the journey from the start to where we are today. The future makes sense only in the context of how we arrived at the present.

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The Truth About OfferGen & Telephonophobia

Telephonophobia

For the Gen-Y readers: that round thing with holes in it is called “the dial”. I know you’ve never seen one in the wild.

I recently had the pleasure of talking to Andrew Flachner of RealScout, who penned this article on Inman recently:

The answer to me, and to many real estate veterans, is obvious. A strategy that directly focuses on producing more transactions, while providing more value to the client, is far more rewarding, both financially and professionally.

“Offer generation,” the strategy of systematically and scalably converting clients into transaction offers, is the direct result of this realization. It will benefit the industry to have the same thought leadership, financial investment and technological innovation garnered by lead gen to be redirected to “offer gen.” We need to focus more on generating offers and less on generating leads.

I couldn’t agree with Andrew more on the concept and the philosophy behind this “OfferGen Movement”. But I thought I’d write this to point out the obvious truth about OfferGen, and make a suggestion or two (that will go ignored by the Powers That Be, of course).

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The National Broker Public Portal — Not for everyone?

The National Broker Public Portal announced appointment of its initial board of managers this week. In the press release they state that the project is designed to fill “an unmet need in the online marketplace.” Unfortunately, don’t define what that need is, leaving many readers still scratching their heads wondering “Wha??” Have these folks divined a gaping hole in the Zillow/Trulia product strategy and set about to fill the vacuum before anyone else sees it? With hundreds of listing portals and tens of thousandsBroker Portal Logo of agent and broker IDX sites, how could there possibly be any “unmet need” remaining anywhere? We shall see what that means.

In their earlier information releases, the group described the project as “the Creation of a National MLS Consumer Facing Property Search website.” Apparently it evolved to a Broker website in the past 30 days which is most interesting given that it is to be funded by MLS dues to the tune of somewhere between $1 and $3 per MLS subscriber per month.

The funding basis was made possible by a redefinition by NAR some time ago of what Basic Services are in MLS land. Basic Services now includes public facing MLS websites which can be supported by dues paid by ALL MLS subscribers even though they may compete with SOME subscribers and their brokerages. Interestingly enough, the larger brokerages and franchises fought this change heartily. In May, 2013, The Realty Alliance wrote a letter to the MLS Policy Committee stating, “… since we are not in favor of MLSs establishing public-facing listings display websites, we certainly do not favor leaving only the words, “establish or maintain” in the authorization to use our dues/fees/reserves as it is too wide an authorization. Significant dollars of ours could be spent “maintaining” these sites, including marketing and promoting these in competition with broker IDX sites.”

Bob Moline, President and COO of Berkshire Hathaway Home Services and the first name on the announced list of newly elected managers of the Portal, wrote at the same time:

We have no doubt, based on proposals and communications of others of which you are, no doubt, aware, that some want to use the fees and dues collected by MLSs and Associations to actively market public-facing sites. Such expenditures–and the public facing websites themselves–would put MLSs and Associations in competition with many of their broker-members, specifically their larger broker-members.

Therefore, we strongly suggest that the proposed new language on advertising specifically exclude the use of MLS of Association dues or fees to market public-facing website. (emphasis added)

Yet, that’s exactly what happened. Despite the protestations, the NAR Board of Directors approved the MLS committee’s proposed rules change and included MLS public facing sites in the definition of Basic Services. Now the Realty Alliance and other major brokers are backing the biggest implementation so far of the new policy.

Please don’t misunderstand — I am not accusing any of the major brokers of doing a flip-flop on this issue. It actually makes great sense for the brokers and major franchisers to back such a move, even though they opposed the rule change that made it possible. From their astute perspective, it is easier to manage one national MLS portal than 600-800 small ones. By imposing the Fair Display Guidelines (see below) from the top down, they need not fight the multiple skirmishes that would surely arise from a bottom up approach.

Much conjecture and critique has been levied at the project and it’s not even off the drawing boards yet. But in all that’s been written about the Broker Public Portal, one question has not been asked that I think needs to be addressed before it goes further.

One of the core tenets of the project is the adoption of the Fair Display Guidelines that the Realty Alliance developed back in 2012-13. Guideline number four states, “ No Ads For Other Brokerages Or Agents Displayed On Or With A Brokerage’s Listing” and goes on to explain:

Only the actual listing broker and agent may be displayed on the property details page. No ads from companies that may compete with a broker’s affiliated business such as mortgage, title, or escrow companies will be displayed on an individual property listing page.

So only the listing agent and brokerage will appear on property detail pages. Buyers’ agents, who by definition do not have any listings, will not be given any exposure at the “point of purchase” – the moment when a potential buyer has a question but perhaps doesn’t want to ask it of the legal fiduciary of the seller for fear of disclosing something about his/her negotiating position. Those buyers agents are members of the same MLS that is supporting the Portal; they are paying the same dues as the listing agents; and $1 to 3 of their dues payments each month are going to fund this portal project. Yet they get nothing in return? How is it that no buyers’ agents have asked the magic question, “What’s in it for me?”

If the average MLS subscription fee is around $25 to $28/month, then somewhere between 4% and 10.7% of the gross revenues of the MLS are going to pay for a Portal that benefits only the small minority of agents who actually take listing contracts. That seems grossly and unfairly lopsided. I’m surprised someone hasn’t challenged that model yet.

~bb

This post also appears on Procuring Cause blog.

The Evolving MLS – Part IV – How do we get there?

So far in Part 1 of our journey, we have examined the pressing problems facing the MLS industry.
In Part 2, we identified the source of those problems.
In Part 3 we proposed a solution based on a totally new architecture of the core MLS technology, the database that drives the entire interconnected system. Now let’s look at how we get to this solution.

How We Get ThereThe road map to success for such a dramatic change in the infrastructure of our industry will be fraught with peril and filled with potholes. But with a common purpose and diligent attention we can achieve success.

Throughout this project I have been encouraged by the open mindedness of most of the major technology companies I have talked with in pursuit of this goal. But such a pursuit closely resembles the traditional chicken-and-egg paradox – which comes first?

Does a major MLS vendor take the first step, segregate its database and open it to developers with an invitation to cooperate in a larger pursuit? This has been attempted on a limited scale and has seen some modest success. FBS, itself a major MLS technology provider, introduced its Spark Platform some years ago but it has not captured the imagination of the vendor community at large.

The Clareity Store seeks to address the interoperability challenges between MLS systems through a common authentication linkage between systems and vendors but does not take on the challenge of common interfaces across all database systems.

No single legacy vendor has dared to take the first step of divorcing the database from the applications layer and opening the system to all developers without licensing costs. At the same time, no group of application developers has aggregated its product lines in hopes of enticing system vendors to open their systems. Short of the few inquiries I received initially, no MLS CEO has taken the bold step of actually notifying an MLS vendor that the MLS was aggressively pursuing this approach and would require the MLS vendor to cooperate or lose the market. No one wants to go first.

Now an industry consultant with no stake in the current MLS vendor field has proposed someone, some technology vendor somewhere, take the first step and create the open database into which a community of application providers can offer their products across a broad base of MLS operators. But that vendor will want to see a broader demand base of support before it would be willing to expend the time and effort needed to even reply to a request for proposal.

The key to cracking the eggs and hatching the chicks is to identify and induce a group of MLSs willing to take the first step and ask for the system to be developed. Fortunately, a couple of intrepid MLSs were willing to take that first step and with their committed inquiries in hand, I approached a number of technology vendors to see if I could find one willing to work on this project.

But I had some firm criteria that a database vendor needed to meet to be considered. An endeavor such as this could not be just two guys in a garage who thought they could do it. Here were my criteria:

  • It had to be a substantial company (read that as having resources, both financial and personnel, to actually do this) with a track record of aggregating data and managing a large, scalable database ;
  • It had to be a company with experience not just in handling MLS data but in integrating multiple other databases into a cohesive property-centric system; and
  • It had to be a company with minimal industry “baggage” — not a company to which the first reaction of most would be, “OH, NO, not them.”

That last requirement eliminated a number of the most likely candidates including the national portals as well as most of the major system vendors and all but a couple of public records providers. In an undertaking like this one, if a company had both lovers and haters, the stridency of the haters would probably overwhelm any attempt at honest debate and careful, logical consideration.

Fortunately I finally identified one company that met all my criteria but which I thought would, for reasons that will be obvious shortly, not be able to even consider getting involved. That company was the Realtors Property Resource – RPR – the subsidiary of the National Association of REALTORS(R) that has been successfully operating a national-scale property-centric aggregated database of real estate information for over five years.

2015 RPR-Logo_02RPR has a specific mission — to supply Realtor practitioners with technology tools and information that would allow them to further demonstrate their value to better serve their consumer clients by providing service that their clients could get nowhere else. Their product is spectacular. Those that use it love it and it has been steadily evolving and improving to the point where those who use it regularly feel they couldn’t do without it.

RPR was created through the acquisition of the Cyberhomes technical team and product base from Black Knight (at that time called LPS). With the team and the technology, RPR negotiated data licenses for many of the public records and other data sets that LPS had accumulated and continues to license that data today. RPR has direct data feed relationships with more than 600 MLSs, including 900 associations, representing over 865,000 REALTORS® and has already built the technology to facilitate sharing those data sets across any number of MLSs that have separately agreed to do so.

In my initial meeting with RPR, Dale Ross (CEO), Marty Frame (President) and Jeff Young (Chief of Operations) expressed one significant reservation about even considering this project. If RPR were to jump in, it might be very misunderstood by the rank and file Realtor as an attempt at a power grab by NAR — trying to create a National MLS and put all the locals out of business. Admittedly, such a scenario would be incredibly stupid for RPR to attempt because (a) they had contracts with hundreds of MLSs that prohibit them from competing to provide MLS services, and (b) many of the Realtor associations rely on income from their MLSs to provide other services to their Realtor members. Even though such a move would be political suicide, that fact alone would not be enough to keep some people from thinking there might be an ulterior motive. Conspiracy theories would abound and proponents of this new technology would be shouted down before they could even explain the benefits involved.

But if I were to come to RPR and ask them to respond to specific MLSs who have specific needs and are asking for help from RPR to meet those needs, well that would be a different story. If RPR were asked to repurpose technology that NAR had already invested millions of dollars to develop, and in doing so could create an alternate revenue stream for the company, the executives of RPR would be derelict in their management responsibilities not to respond.

And so I did. With RPR’s endorsement (and, full disclosure, their agreement to cover my time and expenses in this undertaking), I began contacting MLSs that were identified as strong potential partners, led by executives and leadership who were open-minded and forward-looking, leaders who would hear me out without shouting me down at the first mention of something new, different, challenging, but ultimately rewarding for all involved.

And that’s where we are today. We have eight MLSs from all over the country of various sizes and configurations to whom I have made this presentation and who have submitted letters requesting a specific proposal, in writing, to create the framework for this new technology. The response was great enough that RPR had to assign the project an acronym — AMP — the Advanced Multi-List Platform.

It is critical to note at this point the name of the project is Multi-List Platform, not Multi-List Service. To quell any initial heartburn, let’s dispense with the elephant in the room question right up front. AMP is not designed or intended to replace an MLS – Multiple Listing SERVICE. It is designed to provide the technology that the Service uses as their core system – the database platform upon which the system is built and through which Service is offered. AMP is not an attempt to create a national MLS (a concept that, to my thinking, wouldn’t work anyway, but that’s another blog post). AMP requires no changes in rules, regulations, oversight, staffing, management, or governance. The business of the MLS and the people who manage that business remain the same – just the technology behind the scenes changes.

RPR is now working on proving the concept behind the theory, putting details to the general outline of this new advanced architectural platform. They will be working with the MLSs who have stepped up as the pioneers brave enough to journey into a new world of technological innovation.

What will be the result of all these efforts? How will the problems be solved and what can all parties expect as the beneficial result of this hard work? Let’s examine those questions.

The Benefits for all Players

Separating and opening the database will immediately make possible many new approaches to MLS operations, all of which will benefit the brokers, agents, the MLS, the MLS stakeholders, and the vendors who support all of them.

Vendors

For vendors, new markets will open into which they can sell their products and services. Gone will be the closed monolithic system where only the primary vendor in a market was permitted to offer services. With some slight modifications to conform to the data and schema standards and to use the APIs for access, the CMA module from an FBS system, the farming system developed by Paragon, the CRM system developed by Stratus, the prospecting and lead management system in Matrix all could run just fine on the new, open and accessible database. Third party, non-MLS system vendors would no longer be challenged to write new code for every MLS system that comes along or convert their products when the MLS changes system vendors. The database would be the same across all systems.

  • By opening the MLS, technology vendors will find more open markets, more agents available to buy their products, and more opportunity to increase revenue with lower development and support costs for the MLS provider.
  • Developers will also be able to get out of the business of aggregating MLS data in order to simply make their applications work.
  • Product marketers would be able to accomplish MLS integration much faster and easier since the API would be the same across all MLSs. Developers could write the code once and use it with equal facility in all installations.
  • Vendors would no longer be challenged to write new code for every MLS system or convert their products when the MLS changes system vendors or adds a new data field.
  • Mobile app developers would no longer be challenged to build a different application for every market.

Agents and Brokers

Agents and Brokers will find a new world of applications that were previously not available to them, and those that were available can be offered in a more palatable manner.

The days of an MLS providing one tool for all subscribers because the only way to acquire it at a reasonable cost was to buy it in bulk will be a forgotten memory. With an open MLS system, the role of the MLS changes from being the reseller of a bulk purchased service to the licensor of such a service that is then purchased only by those who want and need it. The major complaint that agents were being forced to pay for services they didn’t want or need, would be eliminated.

Further, brokers with already developed infrastructures could embed any search client or other “widget” or “plug-in” directly into their company’s intranet thus further enhancing agent loyalty and brand awareness. Once the RETS standard for updating transactions is completed and published, those same broker intranets could initiate and maintain listing records directly in the MLS database through an embedded listing maintenance widget. This would maintain the data integrity of the MLS while directly addressing broker demands for renewed control over the listing distribution process using Upstream or a similar management system.

Agent Benefits

  • Agents will have more choice in picking from a menu of applications that were previously not available or integrated with their MLS system.
  • Agents will be free to mix and match tools from different vendors to suit their needs and work styles.
  • Agents will only pay only for what each agent uses by subscribing to each of them individually.
  • An agent’s data stays synced wherever she goes, as she works across different applications.
  • Agents would find listing entry and update to be much easier and more streamlined. In a parcel-centric database with each physical property has only one record, thus eliminating duplicate or “refreshed” listings.

Broker Benefits

  • Brokers would no longer compete with the MLS in offering tools to agents because brokers can select which MLS tools are offered to their agents.
  • Brokers can now receive a single data feed or fully integrated applications from multiple MLSs in which they participate using the same platform.
  • Brokers with already developed infrastructures could embed any search client or other “widget” or “plug-in” directly into their company’s intranet thus further enhancing agent loyalty and brand awareness.
  • Brokerage intranets could initiate and maintain listing records directly in the MLS database through an embedded listing maintenance page or widget.
  • Any brokerage that wants to build its own applications can do so easily as authorized by license. If a brokerage operates across multiple markets the broker apps will be complete and work the same in all markets.

MLS and its staff

MLS administrators will find it much easier to meet their responsibilities for keeping the MLS’s biggest asset – its data – safe from marauders. Through judicious and automated data licensing processes and effective monitoring systems, the MLS can enroll tech providers at a record rate and offer subscribers an expansive library of apps while still maintaining control over the data.

The APIs used will pass only the data needed at that moment by that application. With few exceptions, the days of vendors needing to download the entire MLS database to make their products work will be gone.

Staff and Committee work that in the past has focused on product review and selection can be refocused on more productive activities. No longer would MLS leaders need to evaluate competing products in order to choose the best one for the entire market. Under an open MLS concept, all products that met the licensing requirements and conformed to MLS data rules could be offered equally in the market. The end user, not the MLS staff or volunteers, would make the buying decision.

MLS Benefits

  • MLSs can easily bring products and services to their subscribers thus satisfying the demands of their brokers for choice on a platform that evolves in the future.
  • The MLS staff can meet their responsibilities to monitor data access and use, and easily cut access to offenders.
  • The APIs used will pass only the data needed at that moment by that application. With few exceptions, the days of vendors needing to download the entire MLS database to make their products work will be gone and with them the uncertainty about what the vendor would or could do with the data now in their possession.
  • The MLS can eliminate nearly all costs for providing IDX/VOW, as well as removing the need to rely on an outside syndication company to distribute data.
  • MLSs will no longer have to purchase tools in bulk because that was the only way to acquire them it at a reasonable cost.
  • Since public records and tax data are integrated with property listings in a parcel-centric paradigm, licensing costs are reduced.
  • Automated licensing processes allow the MLS to offer a broad library of apps, while maintaining strict control over the licensees.
  • The simplified licensing process will allow the MLS to set up many more vendors more quickly, thereby providing more sales options and the opportunity for more revenue streams.
  • By eliminating competition between proprietary MLS system vendors, there will be no more MLS conversions – ever. The nightmare of retraining the entire membership on a new system will end.
  • Authorized applications do not need to be supported technically with data feeds, greatly reducing the support costs to maintain and manage those feeds.
  • In the “pay only for what you use” scenario, site licenses would no longer be practical or desirable. Agents would subscribe to and pay for each piece of the system they want to use.
  • MLSs will increase compliance and improve data integrity. A single property record, with nearly all of the required fields already resident, will eliminate most typographical errors since new data entry will be minimized.

Association owners

  • For associations thinking about a future merger with another association, this structure offers much flexibility.
  • Combining the two databases of merging MLSs on the same platform and using the same structure is a non-event.
  • On the other hand, having a common database may negate the need to consider a merger. Overlapping market disorder is a thing of the past and with it went one of the more compelling reasons boards consider merging.
  • All of the systems on the common database platform could maintain their local culture and integrity by simply sharing data with subscribers of neighboring MLSs.
  • System sharing could be with or without an accompanying offer of cooperation at the option of each MLS. The association and MLS could still decide.

In the past year, RPR has introduced the concept of an open MLS platform directly to over 20 MLS chief executives and to industry leaders across the country through its RPR Advisory Council. The reaction has been overwhelmingly positive. AMP provides RPR an opportunity to continue and expand the RPR mission of supplying Realtor practitioners with tools and information that increase their value to their clients, while at the same time supplying much-needed innovation through technology and infrastructure to the MLS community.

In Conclusion (please, hold your applause)

Is this a change in direction for RPR or just a logical extension of their current mission to be a national technology solution provider? The answer is that RPR’s AMP project is the logical extension of the mission and purpose RPR is already fulfilling. It is an extended use of the formidable technology and infrastructure RPR has already developed.

I am hopeful that in the months to come RPR will be able to demonstrate that the ideas of the MLS tools of choice, of universal standardized data access, and of the menu of services approach to providing MLS applications to agents will prove to be a real possibility and eventually a reality. I look forward to continuing to work with RPR as we journey down this path. If you want to come along, please let me know. I’ll keep you updated on our progress.

This post first appeared on Procuring Cause blog.

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~bb