Tag Archives: End of IDX

Syndication vs. IDX By the Numbers: A Response to Sam DeBord

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Reader, thinker, and frequent commenter Sam DeBord has written a rebuttal over at GeekEstate to my declaration of vindication re: IDX = Syndication:

IDX creates efficiency for brokers, which increases financial profitability for the group as a whole.  Syndication is a less-efficient platform in terms of overall brokerage profits.  Real estate is, on an annual basis, similar to a zero-sum game.  There are only so many transactions, and commissions, that will occur based on the market.  Financial profitability is dependent on earning as large a portion of that commission pool as possible.

Read the whole thing.

I think Sam’s written a thoughtful rejoinder, and introduced a hitherto unexamined argument: that IDX increases financial profitability for brokerages. I’d like to delve into that a bit.

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IDX, Syndication, and Vindication: Oh, That Crazy Rob Hahn Edition

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This is a brief post, since I just got off nearly three weeks straight of being on the road. The latest stop was at Stefan Swanepoel’s T3 Summit where I spoke on a panel and had a great time bantering with Brian Boero of 1000watt about hot topics in the industry. I may do a fuller review of the event and some of the issues raised, but… this post is almost 95% personal. :)

For the past few years, I’ve been arguing that there is no reasonable difference between syndication and IDX, and that the fervor against syndication must and will result in the death of IDX. I put it formally on “paper” (on this blog) in January of 2012 with my Seven Predictions for 2012 post when I named the Start of the End of IDX as one of the predictions.

As longtime readers know, the response from the industry has been… well… let’s say that it ranged from well-constructed arguments on why the two are different, to bemused dismissal, to “Oh, that crazy Rob Hahn!”

Here are a few examples of the more rational, well-constructed arguments:

Kris Berg:

“Both Rob Hahn and Jay Thompson pointed out that Internet Data Exchange (IDX) sites like yours, mine, and the sites of every brokerage in the country, are no different than the Troika sites. I don’t agree. The data accuracy issue becomes a relative non-issue where IDX is concerned save the MLS input errors. Even then, the MLS’s have procedures in place for policing and ultimately ensuring compliance. More importantly, IDX sites lack the resale component of the troika sites. While an inquiry on my listing may in fact go the agent-owner of another IDX site – and often does – consumers are generally clear on the fact that they are on a particular broker’s or agent’s site. And while some ambiguity may still exist where an IDX site is concerned, they are not simply trying to sell the customer to the highest bidder.”

Brian Larson:

Rob Hahn has said there is no meaningful difference between IDX and syndication and that he thinks brokers pulling out of syndication are a harbinger of IDX’s demise; but I think he’s dead wrong. I’ll try to make my point here in a post considerably shorter than one of Rob’s Notoriously long ones ;-) You can see Rob’s post claiming (erroneously, I think) the equivalence of IDX to syndication here; regarding the Austin “kerfuffle” as evidence of the impending demise of IDX here; and offering further comments about Austin and IDX here.

And we can go on, but in the interests of space, let’s curtail it. Suffice to say that for as long as I can remember, people have been pointing at various reasons why IDX != Syndication, and why the same people yelling about “My listings, my leads” when it comes to Zillow are as quiet as the grave when it comes to same listing on a website of an agent 75 miles away.

Well, on my MLS panel, Ken Jenny of tranCen, whose clients include some of the largest brokerages and national franchises, said many things from a very broker-centric perspective, and one of them was that brokers are starting to question IDX. I was sitting on the panel, so I didn’t write down his comments word for word, but to the best of my memory, Ken likened IDX to the practice of planting your yard sign on someone else’s listings, which “we would never allow in any other situation”.

I about fell out of my chair.

That argument, about yard signs on someone else’s listings, is exactly the same one made by people like Jim Abbott of ARG against syndication. It was one of the foundational reasons why I thought syndication = IDX, and that all the hoopla over Zillow would spill over into the thousands and thousands of broker and agent websites that rely on IDX to generate leads… off of someone else’s listings.

Look, Ken Jenny mentioned a lot of other issues, including bombs like “brokers are wondering about mandatory cooperation and compensation”, but I’m marking down April 9, 2015 as one Day of Vindication for yours truly. :)

I might be crazy. I might be a couple of years ahead of my time. Or both. To be fair, many of you were among the first to recognize the logic, so here’s a tip o’ the cap to you! #bestreadersintheindustry

-rsh

The Realcomp Anti-Trust Ruling Will Affect MLS Syndication

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Inman News reports that the Sixth Circuit Court of Appeals has ruled against Realcomp II in a years-long case:

Michigan’s largest multiple listing service “unreasonably restrained competition” among real estate brokers by refusing to transmit exclusive agency property listings favored by discount brokers to Realtor.com and other public-facing Web sites, a federal appeals court has ruled.

At issue was whether Realcomp’s refusal to transmit Exclusive Agency listings to places like Realtor.com was anti-competitive. Since Realcomp’s policy only applies to a tiny fraction of listings in the market, Laurie Janik, the outgoing General Counsel of NAR, suggested this wasn’t that big a deal:

NAR General Counsel Laurie Janik said that because other MLSs don’t have similar rules in place, the appeals court ruling is unlikely to have a wider impact. “I’m sure it’s extremely disappointing news to the folks at Realcomp, but it’s not the kind of case that’s going to send ripples across the rest of the industry,”

That’s especially true since the NAR’s MLS Policy prohibits the MLS from excluding Exclusive Agency listings from feeds, as Realcomp had done.

Nonetheless, I respectfully disagree with Ms. Janik. I think this ruling will send ripples across the rest of the industry. At the very least, it should since the next case that comes down the pike will surely look at Realcomp II, Ltd. v. FTC as precedent.

(By the way, for the non-lawyer folks, this case is especially significant because it came from the Sixth Circuit Court of Appeals. The only higher court is the Supreme Court. At least within the Sixth Circuit, which covers Kentucky, Michigan, Ohio and Tennessee, this ruling is binding. And throughout the country, the ruling will be extremely persuasive.)

Before we dive into why I think this ruling is significant, since I am doing law-blogging here, I have to say that this is in no way a legal opinion (I mean, c’mon, it’s a blog post) and that you should consult your own qualified legal counsel.

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“You’ve Got Ten Days”: CMLS 2013, Realty Alliance, and the Most Interesting 30 Minutes in Real Estate Conference History

This post, like every post in the month of October, is brought to you by our sponsor, Teardowns.com (and its subsidiary 2Elm), the winner of the Ebay Auction for sponsorship of this blog for October.

The floor of CMLS general session as Craig Cheatham was speaking

The floor of CMLS general session as Craig Cheatham was speaking

On the last day of CMLS 2013, the most interesting 30 minutes in the history of real estate conferences happened. Seriously, I’ve been going to these industry confabs for years now, and have seen some really interesting panels, have heard great speakers, have been part of great debates. I was there at Midyear 2011 when Franchise IDX was going down. I was present when RPR was brought forth in 2009. I’ve been privileged to be at important meetings where important people made important decisions.

And I have never ever seen a room filled with a few hundred seasoned industry veterans — CEO’s, Association Executives, senior executives of major tech companies, — get like that.

Like what? Well, like the inside of a mausoleum on a moonless night. If a flea had farted, we all would have heard it. The tension in the room was second only to the quiet dread permeating the audience.

The immediate cause of this sepulchral atmosphere was the panel discussion entitled, “Eliminating MLS & Broker Conflict” featuring Gregg Larson of Clareity, Brian Donnellan of MRIS, and the star of the show, Craig Cheatham, CEO of The Realty Alliance.

Bottom line, Craig Cheatham made it clear that The Realty Alliance intends to Do Something about the MLS, which he said was the biggest pain, the primary focus of concern and the biggest source of frustration for his members. Those members, in case you aren’t aware, are some of the largest brokerages in the United States, including such names as HomeServices of America, Long & Foster, Howard Hanna, Crye-Leike, Ebby Halliday, Prudential Fox & Roach, Baird & Warner, Coldwell Banker United, etc. etc., and the list goes on.

This is one session I wish I had videotaped, since Cheatham’s comments were jaw-dropping, even though he delivered them with consummate grace and diplomacy. Words and phrases like “nuclear option”, “push the red button”, “don’t plan too many more of these CMLS events into the future”, and of course, “You have ten days” are… shall we say… attention-grabbing? Perhaps the CMLS website will have the video available soon. But you can check out the companion post to this one from Notorious B.O.B. (Bemis) for what went down, as well as some fantastic historical perspective. I’m sure we’ll have other reports of what went down from various sources soon as well.

What I’d like to do with this post — which is going to be lengthy — is to speculate as to what might come next. After the ten days are up (and by the time you’re reading this, it’s closer to seven days left), what is the Realty Alliance likely to do? So two warnings.

First, this is rank speculation on my part. I have no inside knowledge, I haven’t officially spoken to anyone from the Realty Alliance, nor do I have any proprietary information. Second, this is going to be long.

Predictions sure to be wrong, or your money back! Let’s get into it.

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The Next Lion . . . the Next Hill: Thoughts from CMLS 2013

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The Council of Multiple Listing Services held its annual conference in Boise, ID this past week. In keeping with the high standards of excellence (which may be redundant, but I liked the phrase) of past conferences, our host, Greg Manship from Intermountain MLS, the local host, and his staff put on a top notch program. Many of the panels actually discussed real industry issues which in the past has not always been the case. That’s not a ding on CMLS. It happens at every industry conference. The panelists talk but ignore the multiple elephants that roam around the room.

Not this time.

One discussion on Friday led to much “chatter” in the halls, an unhealthy level of speculation on what was really being said, and a healthy level of panic and paranoia as MLS CEOs tried to figure out what to do next.

Let me explain.

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