Notorious R.O.B.

Now this is not the end. It is not even the beginning of the end.  But it is, perhaps, the end of the beginning.

- Sir Winston Churchill

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One of the true pioneers of the new generation of real estate companies, Redfin, has launched a new partner program:

Redfin released a sprawling, glorious update to our website last night that changes Redfin in two fundamental ways:

1. We built data-driven agent profiles, showing every deal our own agents have done and every customer review, even on deals that failed.
2. We opened up our business to partner agents and we published all their deals too, surveying old customers for reviews.

How does this change Redfin as a company? Well, when we upgraded our own service last November to offer unlimited home tours and a choice of agents, everyone said we were becoming less virtual. And now that we’re connecting consumers with partner agents, folks will say we’ve become more virtual.

Actually, I think the change to Redfin as a company is far deeper and far more subtle than what folks will say.

The Peanut Gallery

A hint of what’s changed comes from Gregg Swann of the Bloodhound Blog:

If Redfin can make five figures a day on what may not even amount to a single full-time staff line, that’s a killer business.

Maybe even such a killer business that it will replace client-representation altogether. Implausible? One of Redfin’s planned expansion cities is Phoenix — where our numbers are worse than Kitsap’s. Of the RE 2.0 players, only Estately.com does anything like this, but Redfin could go into the referral business virtually anywhere, virtually overnight.

And Louis Cammarosano of HomeGain said with maximum succinctness, over Twitter: “It means they are becoming like Homegain.”

John Cook at TechFlash took Redfin to task:

The concept is not new. In fact, Seattle area companies such as Estately and HouseValues.com also earn money through agent referrals. But the program is a big switch for Redfin, which has always touted the customer service focus of its agents. Kelman said he was “terrified” that the partner program “could screw up the brand.” That’s why the company interviewed all of the partner agents and implemented an agent review system on the Redfin Web site. It also reserves the right to remove partner agents that are not living up to customer service requirements.

Kelman downplayed the possibility that Redfin would move entirely to a partner model. “There is something in Redfin’s blood that we like having direct relationships with the customer,” he said.

This change is a fundamental one.  This is not a mere extension of the Redfin model and philosophy.  It’s something else.

What Was Actually Done

TechFlash post above actually has a pretty good brief description of what Redfin actually launched:

Starting today, the company has aligned itself with 35 real estate agents from 13 different brokerage firms in nine counties. The agents, which receive a profle page on Redfin and must have completed 15 transactions, pay Redfin a 30 percent referral fee on any completed deals. Redfin then refunds 15 percent of that fee to home buyers, keeping the other 15 percent.

But Redfin has more info on this front:

Every single one of these partners committed to our consumer-friendly values as a prerequisite to joining the program:

1. Technology: the partner refunds part of his commission to the client because the client asks for service online using our tools.
2. Service: the partner is not allowed to do any of the funny-business around forcing someone to use him when buying a house; the partner earns more when the client is satisfied.
3. Transparency: the partner publishes information about all his deals, and all his reviews; the partner provides the service requested by the consumer and nothing more unless asked.

Furthermore, rather than sending the “leads” to the agent (or multiple agents), the Redfin model places that power in the consumer’s hands.  The consumer sees the deals, failed deals, activities, etc. of the partner agent, then actively chooses to contact that particular agent.

So, the major differences between Redfin and other models are:

• Power to choose in the hands of consumer
• Transparency on agent quality metrics
• Refund back to the consumer

But all of that, still, fails to address the central, subtle, and fundamental change.

The Change

Basically, by going to a ‘partner’ model, Redfin is no longer responsible for the consumer service experience.

Now, Glenn Kelman and others at Redfin vigorously dispute this:

The story said that we had been “terrified” about potential problems in our partners’ customer service without explaining that we said that to introduce the steps we took to avoid those problems. (emphasis added)

And

We planned for Redfin’s partner program in a financial model built in 2007. We experimented with it earlier than that, canceling the program in 2006 after it became clear that we had no way of being accountable for good service to the client.

…

We could have offered a year ago the referral programs typical in the industry, selling the client out to multiple unnamed agents for a fee. There was ample financial pressure to do so. We stuck to our guns to create something much better, building an entire accountability system and a set of tools for a client to ask a particular agent to perform a particular service, interviewing every partner agent in person, and checking each agent’s references over a year back, so we could offer a partner program consistent with our values. These values are why we radically cut the profitability of the program by offering half our fee back to the consumer. (Emphasis added)

For what it’s worth, I completely believe Redfin.  And furthermore, Redfin might very well be successful.

However, there is a large gap between “building an entire accountability system” and actually being accountable.

Redfin is a brokerage in the markets in which it is active.  The agents who work for Redfin are employees of Redfin, and Redfin as an entity is accountable to the actual consumer for the service experience.  In fact, while I don’t know for sure, I’m going to guess that Redfin has a certain “Redfin Way” of “Redfin Service Standards” or whatever that it enforces on its agents.

If I’m a Redfin agent, and I don’t live up to Redfin’s performance standards, then Redfin has a variety of tools and methods at its disposal to enforce standards.  With these partner agents, no matter how well Redfin screens ‘em, Redfin only has one way to enforce standards: remove them from the program.

If I pick a partner agent, and have a terrible experience, who do I get to blame?

The Liability Question

A way to crystallize the issue is to consider legal liability.

Suppose that some unhappy consumer sues the partner agent after a deal goes south.  (Not saying this would happen, but thinking about lawsuits help clarify some issues.)

The agent’s actual broker would be named in the lawsuit, since legally, the agent is just representing the broker.  The broker’s E&O insurance would come into play, and the lawsuit would then focus on whether the agent’s acts/omissions rose to the level of professional malpractice.  The broker’s processes, standards, training, screening, etc. would all become relevant as to establishing liability under respondeat superior theory.

Where does Redfin fit into this?

On the one hand, the consumer would absolutely sue Redfin.  After all, Redfin supposedly screened all of its partners, and built an “entire accountability system”.  That a crappy agent slipped through resulting in a big loss for the consumer means that the consumer has a reason to sue Redfin.  After all, he went to Redfin to find an agent, and relied upon Redfin’s representation as to quality, professionalism, and ethics.

On the other hand, Redfin’s defense would presumably be along the lines of, “We ain’t the boss”.  They would presumably assert that respondeat superior does not apply in their case, because the agent doesn’t work for them.  They don’t control the agent’s actions.  All they’ve done is made an introduction between the consumer and the partner agent, and the consumer chose to work with that particular agent.

(I suppose, in theory, Redfin could choose NOT to fight liability and embrace it wholeheartedly in order to preserve their ideal of customer service… but I doubt that very much.  Lawsuits focus the mind in interesting ways.  Plus, does Redfin’s E&O insurance even cover these ‘partner agents’?  Would Redfin’s insurer really agree to that without a substantial hike in premiums?)

If the agent’s broker — the actual “boss” in theory — is held liable, would they not consider bringing Redfin in as a third party defendant?  Or bring an indemnity claim that goes something like, “Your program caused our otherwise ethical agent to do bad things, so now you owe us money”?  I know I would advise the broker to bring such a suit, were I representing them.

With the other lead-gen sites, like Homegain or HouseValues, these issues never arise.  All that those sites promise to consumers is that someone will be in touch, and they pass the lead on.  They’re merely a marketing conduit.

Redfin’s program goes far, far beyond that… but they’re not ultimately accountable to the consumer client from what I can tell.

The Brand and Ideals Question

That Redfin would disavow responsibility for a poor consumer experience through Redfin is, to say the least, a sea change.  As Glenn says quite passionately:

We will always, always fight for the consumer: exposing information about agent performance the world has never seen, offering the best value we can, paying our agents based on customer satisfaction, negotiating with Realtor associations to publish more data.

This is an emotional issue for us. We are less interested in proving TechFlash wrong, or even in convincing you that Redfin will succeed or fail — which is still an open question — than we are in establishing what this company stands for: making the real estate industry better for the consumer. Maybe nobody else cares that this company actually stands for something. But we do. We always will.

Does that include accepting legal liablity for the actions of your ‘partner agents’?  If it does, then in what way are those ‘partner agents’ different from your own employees — except that they’re not really subject to discipline/training/enforcement by you?

If it does not, if Redfin’s program stops short of accepting legal liability for the misconduct or negligence by partner agents, then that is a fundamental change in the Redfin brand.  And I daresay it represents a change of the Redfin ideals in a subtle, yet profound, way.  Sure, Redfin can still work to make the real estate industry better for the consumer.  But it won’t do it directly, by training its agents, by implementing its policies and procedures, and by serving the consumer.

That might be fine; might even be great.  Maybe Redfin overcomes some of the acrimony built up over the years this way.

But it is a fundamental change.  He who pays you is your customer.

The End of the Beginning

For the industry, I think Redfin’s move represents the end of the first wave of Real Estate 2.0.  The implication appears to be that new companies cannot implement new business models for real estate.  Trulia and Zillow are not real estate companies; they are media companies in the real estate space.  They make money from advertising.

Homegain, HouseValues, Estately and so on are also pseudo-media companies, but with a pay-for-performance type of ad model.

Redfin was the pioneer of a new model, centered around a fantastic website, direct consumer engagement, and a novel refund concept.  Their obsession with transparency, truly excellent user experience online, and “freakish depth” was the precursor to what the brokerage of the future might look like.

That chapter, I think, now comes to a close.  The new real estate companies have found that they cannot make money directly from consumers.  Okay, fine.  What does the next chapter look like?

No one knows of course.  But it does seem to me that the battle lines are getting drawn as follows:

On the one hand, the new entrants must find ways to derive revenues from real estate agents; on the other hand, the existing brokerages must find ways to make consumers happier and provide more value to its agents.  The midgame, then, represents a struggle on the one hand over consumer service/experience coupled to value delivery to agents, and a struggle on the other hand over getting money out of agents.

We are living through interesting times in real estate.

-rsh

Greg Afarian of Zipvo.com was kind enough to alert me in the comments section of my original post on Zipvo that they are about to announce Zipvo Platinum:

I wanted to get back to you about our “incredibly flawed business model”. We are revealing http://zipvoplatinum.com/ after MANY months of production. We have kept ZIPVO Platinum a secret and because of this we were NOT able to comment on business models at that time. Unfortunately, that whole ads in video and ads in places on the site was a smoke screen to avoid the subject. (sorry about that) We feel that we have a revolutionary product that will change the way Real Estate is found, viewed, shared, and marketed on-line.

As I thought originally that the guys from Zipvo appeared to be really nice, really smart people, I’m glad to hear that maybe I wasn’t seeing the true story of Zipvo. It was kept a secret.

So the real Zipvo is apparently “a revolutionary product that will change the way real estate is found, viewed, shared and marketed online.” Cool. Let us begin the diving.

Except that there isn’t much to dive into, at least based on what has been released/leaked thus far:

Clicking on any of those product buttons takes you to the announcement, instead of any in-depth information about each of the products.

Judging by the front-page of Zipvo Platinum, there are two more mysteries to be unveiled soon, so that will be something.

All of those are very nice, but they do not answer my fundamental critique: How will Zipvo make money?

Presumably, if the “ads on the bottom of the page” was just a smokescreen, then with these products, Zipvo is going to adopt some non-advertising business model. That means either (a) subscription of some sort, or (b) lead sales, (c) data sales, or (d) some new model that has yet to be invented.

To answer these questions, I emailed Greg. The following is from that exchange, posted with his permission.  I will be commenting after each Q&A with my $0.02 on the matter.

Q: Business Model – My original critique had to do almost entirely with the flawed advertising-supported model, which apparently was just a smokescreen.   So… what IS your actual business model here?  Subscription?  Software sales?  Support contracts?

Greg: Yes, our original “business model” was a smokescreen to cover what we were working on behind the scenes. We will still have advertising opportunities on ZIPVO, but our primary business model will be subscriptions to ZIPVO Platinum, licensing agreements, and technical support for our products.

This is honestly a much better business model generally speaking.  However, it now gets interesting, because the issue will now be 100% be whether the products being offered are seen as being worth the price being charged.  All of the ‘free’ models avoid this thorny issue, which is why they are so popular despite being so weak.  Furthermore, since I happen to be working at a company with a subscription/licensing based model myself, I have to point out that Zipvo’s sales team will now become a focal point.

Q: Listings flyers – Seems to me there are a fairly large number of companies offering this.  What makes your product so different?

Greg: Our listing flyers are not necessarily revolutionary. PDF flyers can only go so far. One feature we will be adding is clickable hotspots on the PDF flyer that link back to the listing site. Also, our listing flyers are easy to use. Simply click a button and you get a professional looking listing sheet that includes your photo, logo, listing information, listing photos, and an easy to remember link where customers can go to view your video, more information, etc. That link is also viewable on the iPhone. These flyers are in PDF format so they can easily be printed and emailed.

Meh.  Clickable hotspots on a PDF flyer.  As Greg himself notes, this is hardly revolutionary.

Q: Online address book – Again, seems to me that there are a number of these things out there already.  What differentiates your product?  Very pertinent to this question is if you can answer why you believe agents and brokers would be willing to put their customer data on your site.  What sorts of privacy, data protection, and data ownership features will you be offering?

Greg: There are other address book solutions out there, and much like our other products one great feature is the ease of use and coupling with all your other online marketing needs at ZIPVO. With ZIPVO you can easily connect with business associates and customers. Your ZIPVO Address Book can be used to let your contacts know about a new listing, blog post, or anything else you want to announce with just the click of a mouse. We will also have a “Subscribe to My Updates” feature that allows ZIPVO Platinum users to put a link in their blogs, profiles, video pages, so interested users can automatically be added to their address book, much like a newsletter. We will be integrating a WYSIWYG system so agents can easily create professional-looking HTML emails.

As for privacy, our systems are very secure and all of our login information is encrypted. We backup our site daily so data loss is never an issue. We will also allow agents to download a copy of their address book in CSV format for their own backups. ZIPVO will never contact agents stored contacts, nor will we sell that information. The address book entries are owned by the agents who enter them. If a user decides they no longer want their contacts stored on ZIPVO we will gladly delete the data forever.

I am glad to hear that Zipvo is going to put in strong data security measures for their online addressbook.  But really, what they need to be thinking about is auto-sync.  I’ve had a lot of experience with these sorts of systems from my time at Coldwell Banker Commercial, as these kinds of document-creation and marketing systems are all the rage in commercial real estate, and one of the trickiest things we ran into was the simple fact that most people do NOT want to maintain three or four different client databases.

Without auto-sync, which is not at all easy to do, these online addressbook solutions become yet-another-data-entry nightmare.

Seriously, I hope the Zipvo guys are already thinking about this, and have very easy, very simple auto-sync — and I mean auto-sync, not “download a file in CSV and upload to whatever” — solutions in the works.

Also, WYSIWYG system for the agents is a great idea.  But again, based on my experience, Zipvo should seriously be looking at bringing in office admins instead of agents.  When I deployed a similar system at CBC, what I found was that no matter how much education and training were provided, agents simply did not want to spend time making flyers and HTML emails.  They wanted their admins to do it for them.  Things might be different in residential real estate, but I doubt it.

Differentiation will also be a real issue — how the heck do you differentiate yourself using templated designs?  It’s awfully hard to do.

Q: Singe property websites – People are already doing this, so presumably, the product will offer some value that they are unable to access by themselves.  What is that value?

Greg: Single property websites are nothing new, and have certainly caught on over the last few years. We have three points we feel make ours unique. First, we offer a domain registration service where you can instantly register a domain such as 123mainstreet.com for your single property site. Second, the single property sites are under the umbrella of ZIPVO so our powerful analytics will track how people are finding them, how long they’re staying, and what they click on while they’re there. Third, your videos will instantly embed on your single property sites with a non-branded player. No embed code needed.

This section right here tells me that Zipvo is likely to be aiming at the agent/small-brokerage market.  If single property sites are under the umbrella of Zipvo, then all that consumer traffic is going to some “videos.zipvo.com/123mainstreet” type of URL.  An enterprise brokerage that has an interest in growing traffic to its own site is not going to find this all that appealing, no matter how powerful the analytics. (See below on this point.)

That isn’t bad in and of itself, but getting a subscription/software licensing/support contract type of business model understood by that market segment is going to be something of a challenge.

It might make sense for Zipvo here to figure out a way to let the client host all of these websites as a part of the main client website — maybe a software appliance type of an approach?  I simply can’t imagine NRT deciding to send all the traffic to its single property websites to some other company (to be monetized via advertising, no less), for just one example.

Q: Analytics – Google Analytics is free, and really good.  Why would someone use your analytics?  What are the mechanics involved — javascript?  Log analysis?  server-side analysis?

Google Analytics is undoubtedly one of the best solutions out there, but is only good for agents with some technical skills and limits them to tracking only their own websites. ZIPVO Analytics tracks all of the activity on ZIPVO.com from blog views, profile views, video views, time spent on pages / videos, how they got there, and what they clicked on while on a page. Much like Google Analytics it’s a JavaScript based system but requires zero technical skills by the agent. We will also be integrating server-side analysis in future releases.

This is interesting on three fronts.

First, I hope that Zipvo is going to build API’s or some other way to hook into existing analytics packages.  Even if we’re talking about an individual agent or small brokerage without the technical skills, people are going to want to look at analytics as a whole.  It simply makes no sense to have to login to one system to find out how the traffic to my company website is, then to have to go check Zipvo Analytics to see how the traffic to my video and my profile views and such are.

Second, if it’s a javascript-based system, I wonder how they’re doing the unique tracking pixels.  That sounds like an interesting bit of technology — to auto-embed the unique identifier of the client into all of the pages/video.

Third, I wonder how Zipvo is doing the “time spent on video” metric, and whether they can spot jump-off points inside a video.  In other words, if I have a 3 minute video, can I find out that 80% of the users leave at the 1:36 mark on the video?  That would be cool, but I’d love to know how they’re tracking that.

Q: What are the mystery products you have yet to unveil?   How do they change the equation of the above four?

Our two mystery products are PhotoVideo+ and ZIPVO Video Editor.

PhotoVideo+ allows agents to enhance their PhotoVideos with music, text descriptions of the photos and rearranging the order of photos. The end result is much like the virtual tours that exist today, but the process to get there has been simplified. Unlike some, our PhotoVideos are indexed by Google, embeddable, and are listed in the ZIPVO search directory.

ZIPVO Video Editor is an online editing system that allows agents to edit videos with ease and requires no software to download. In technical terms it’s a non-destructive Flash based system that requires no rendering time when cutting together video clips, photos, and music. Simply upload your videos and photos and you can easily create a professional looking video. The user interface looks like iMovie or Windows Movie Maker and is entirely drag / drop. It’s very easy to use and there is hardly any learning curve. It was based on the needs of real estate video.

I don’t know what a PhotoVideo is, so I probably shouldn’t comment too much.  It sounds like a cool piece of technology though, especially to get indexed by searchbots.

The Video Editor, however, is seriously cool.  Seems to me if it’s really that easy and that powerful, Zipvo should just go after the far larger personal video editing market.  I know I spent hundreds of dollars on video editing software — if I can just do that online, I’d do it in a non-destructive flash.  (Okay, sorry about that… really.)  Thing is, video processing takes enormous CPU/memory on a desktop — I’d have to see this online version work to believe it.  A 5 minute video on my Canon Vixia is like 4GB.  Uploading that over the Internet will take how long?  Processing HD video is going to take how long?

If Zipvo has solved those issues via online video editing… wow.  That’s incredibly cool.

Q: What is REVOLUTIONARY about this product or set of products?  REVOLUTIONARY implies a total paradigm shift — a process of creative destruction.  So who/what will you be destroying?

ZIPVO Platinum is revolutionary for a number of reasons. We provide new and existing solutions to agents, at a much more affordable cost with much better products. There is no longer a need to visit 5 different websites when you have a new listing. ZIPVO Platinum provides a full solution for an agents online marketing needs.

We built our product based off of what our users were asking us for and kept ease of use in mind at every stage of development. We will constantly be releasing new features that make our products even better based on changes in technology, the market, and user feedback.

We put our users first, and everything we develop is based on what they want and need. We even go so far as visiting offices to teach the agents how to use ZIPVO and other forms of social media as it pertains to real estate.

We will be destroying all of the existing companies out there that only offer a fraction of what we do. By using ZIPVO Platinum as your online marketing solution you gain powerful tools at a fraction of the cost. ZIPVO Platinum is ten times better and costs ten times less.

Traditional print media is a dying breed and with today’s technically savvy, instant gratification consumers, an online marketing campaign is essential to success. Marketing yourself and your properties online with powerful tools such as video, blogging, and social media saves an agent both time, money and increases productivity.

You have to love Greg for his enthusiasm — if he didn’t feel passionate about Zipvo, it’s unlikely that he would have devoted so much time and energy into the project.

At the same time… all of the products strike me as evolutionary change.  Perhaps the Video Editor, if it works quickly, is a real game-changer, but the rest of the products are things we all have seen already.  And the Video Editor is way way beyond known technology capabilities, so… color me skeptical until I see it in action digesting a 5GB upload over the Internet, then working with it real-time in Flash.  The real promise here appears to be that Zipvo will simply do them better, and cheaper, and do a better job of listening to its customers.  That is always possible, of course.

The ‘no longer need to visit 5 websites’ is a bit of a stretch, seeing as how the reason why you don’t need to visit 5 different websites is that all of your online marketing will be done through and on Zipvo.com.  Sure, if you’re willing to outsource all of your online marketing, that can be done pretty easily.  But if you already have invested in a company website, have listings syndications setup, then I’m not so sure that applies.

Conclusion

My personal conclusion is that Zipvo may indeed be a real improvement in certain areas, at least for the agent and small brokerage market.  Zipvo may be able to bring the power of institutional online marketing down to the independents — if they can do that successfully, and provide enough value, then I can see them getting a bunch of subscribers.

But now they’re playing in the same space as Move, with its Top Producer product.  It’s possible that Zipvo will end up destroying that business in the whole ‘creative destruction’ cycle.  But it’s never a good idea to bet against one of the biggest players in real estate technology.

Only time will tell.  But revolutionary change?  I don’t see it.  Possibly great suite of products, slickly integrated?  It just may be that.  Stronger business model than ad sales?  Without a doubt.

-rsh

During one of the sessions here at RE Bar Camp, an interesting point came up.

There was a company here presenting named Zipvo — they do real estate video for agents.  Their technology seems good; they seem like bright guys.  The issue was, as I saw it, their incredibly flawed business model.

They want advertisers to fund the site — they don’t want the agents to pay anything to upload videos, to market listings, etc.  They’ll get advertisers to pay for all that.  BUT, they’re only allowing banner ads at the bottom of the page.

I pointed out that as an advertiser (something I have a bit of experience with), that was just about the least compelling value proposition possible.  It’s a video site — but no interstitials?  No sponsorship opportunities?  How about in-video product placement?

The obvious advertisers are giant real estate companies, like Realogy or one of its brands.  But the agents who actually generate all the content will absolutely not countenance something like that.  Imagine you’re a Keller-Williams agent who spent all this time making a video, but before it runs, there’s a 30-second Coldwell Banker ad.

The non-real estate advertisers are consumer-oriented companies who have spent $10m creating their last TV ad.  But they can’t place that in the video ads?

Anyhow, in the discussion, one of the participants raised the point that what’s important is to start something, then iterate.  It’s better to have something “out there” than nothing.

That’s true to a degree.  A bad plan executed swiftly is preferable to a good plan executed with lethargy.

Having said that… there are some things you really don’t want to iterate as you go.  The basic business model — how you actually make money — is one of those things.  That kind of thing pisses off your customer (i.e., the advertiser) and your content producers (i.e., the agents) when you were doing things one way, then completely change the fundamental assumptions.

I wish the Zipvo guys a lot of luck — they seemed like great fellas.  But it’s in the spirit of helping them that I have to tell them… don’t iterate your fundamental business model.  Get that figured out first, then iterate the other stuff as you go.

-rsh

Over at the Future of Real Estate Marketing blog, Joel Burslem celebrates Halstead’s incorporation of New York magazine’s neighborhood profiles on their website. But then he goes on to make what I think is an outrageous claim:

It also signals to me that more brokers are waking to the reality that they themselves are media publishers and therefore need to start acting like them. Inking content deals for their sites is part of that, but so is exploring trends like syndication and distribution for their own content (i.e. listings).

Say what now?

I don’t know Joel, but I’m sure he’s a brilliant guy. And like many brilliant guys, he appears to have forgotten some simple truths.

The business model matters.

What I mean, quite simply, is that how a company actually makes money means something. Calling real estate brokers a “media publisher” doesn’t make them one anymore than calling a pile of poop “caviar” does.

The media business is pretty straightforward in how it makes money. It either (a) sells the content via subscriptions or some other pay-by-consumer model, or (b) cons convinces some company to pay to advertise to the consumers of content. As long as money coming in is greater than the money spent on creating and distributing the content, you’re in the media business, baby! Trulia and Zillow are in the media business (until they’re not, of course, but we’re assured, assured, that will never happen by Trulians and Zillowites).

In stark contrast, the real estate brokerage business makes money upon the closing of a transaction in which a piece of real property goes through a change in legal status. Typically, that’s a transfer of title. But it could also be the execution of a lease, creating a leasehold estate. The brokerage makes money by commissions tied to the final sale/lease price. What the heck does that have to do with the media business?

The content is given away for absolutely nothing, because that ‘content’ is nothing more than advertising, promotion, and marketing for the underlying asset. This is tantamount to claiming that J. Crew is actually a media company because it puts out a catalog.

If real estate companies were to actually act like media companies, they would be inking deals wherein publishers would pay them for their content (aka, listings), or they would get some other company to pay them money to put advertising on their content (aka, listings).

Alas and alack, the legal status of listings is very much up in the air, I’m afraid. After all, who owns the listing? Is it the agent? The seller? The MLS? The brokerage company? The mega national franchise networks such as Century 21?

If the national Century 21 organization (a division of Realogy) inked a deal with Google to send it listings for $1/listing, would the lawyers for the various MLS’es and agents and brokers break the sound barrier in getting to the courthouse to file a suit? Or just fall short of Mach 1?

Look, I dig what Halstead has done from a technical standpoint. As a web guy, I like the user interface, the clean but functional design, and the map integration. But let’s not get carried away here.

From a strategic standpoint, what Halstead has done is properly described as “brand suicide”. Halstead has essentially told every single visitor to the Halstead website, “Our agents know jackshit about the neighborhoods in which they are supposedly experts.” If you want to know where to move to in New York City, don’t ask the boys and girls at Halstead — no, go read New York magazine. That, my friends, is brand suicide.

If real estate is local, then presumably the value of real estate agents is local knowledge. Farm that out to some publication, and you’ve essentially made your real estate agent a glorified paperwork clerk. But, oh yeah, pay me 6% please! That makes for a very compelling value proposition.

Why are we celebrating this again?

What Halstead should have done instead is to make sure that every single agent on its roster is in fact a local neighborhood expert. If you sell million dollar condos in SoHo, sister, you’d better know where to go for the best sushi dinner, which dry cleaner will wreck my $4,500 Brioni suit and which one won’t, and where I can take my dogs for grooming. You’d best know which elementary school my kids will be attending if I buy this condo vs. that condo. Then, Halstead should have done everything in its power to brand those agents as local experts, and kicked New York magazine to the curb.

But I guess it’s easier to take the lazy way out and ink a deal with New York. That way, you could be described as a “media publisher” too, while you flush your brand down the toilet.

-rsh