What I would have said at MLS Connection 2009: Zillow is not the bogeyman

Apr 16, 2009  |  Michael Wurzer

I’m writing this from MLS Connection 2009, where Joel Singer just spoke.  Joel is with the California Association of REALTORS and the driving force behind calREDD, a new MLS system being offered by CAR.  Joel made a basic argument to justify calREDD:

We need one MLS (as opposed to many) to compete with Zillow.

I had my hand up to address this argument, but the next topic was up and so I didn’t get a chance during the sessions.  Instead, I’ll just post what I would have said here.

This argument is wrong on many counts.  First, Zillow is not and never will be an MLS.  Second, the MLS is more than technology.  Third, the idea that a monopolistic bureaucracy can innovate over the long term is fundamentally flawed.

This fear argument from CAR is passe.  Zillow’s a good company, doing some exciting things.  That doesn’t mean they are an MLS or that MLSs aren’t innovating, too.  The innovation ecosystem around MLSs is huge.  We deliver data every day, all day on behalf of MLSs to all kinds of developers and others doing interesting, innovative things.  This is what competition and markets do, they innovate.  The fear being pushed by CAR to reduce competition and create a monopoly is exactly the opposite of what this industry needs.

17 Responses to “What I would have said at MLS Connection 2009: Zillow is not the bogeyman”

  1. As usual, you’re spot on.

  2. Doug Garner says:

    I am not a participant at MLS connect but I have tried to follow the updates the best I can. Seriously? Was that the general sentiment of his presentation? Or, is this just what you took away from his comments? Fear? What would CAR have to fear. I say stop being afraid and take some positive actions toward developing a more customer concentric platform. Give the customers conceived value. Zillow and Trulia offer conceived, and real, value. That’s why their name keeps coming up.

  3. I do think that was the sentiment of his presentation. He didn’t use the word fear, but it was there nonetheless. Importantly, though, he wasn’t saying CAR had anything to fear. Rather, CAR was the protector of the brokers, agents, local MLSs and Associations who he thought should fear those who supposedly will be putting them all out of business.

  4. Hi Doug,
    I saw you on twitter also making this point but it’s too hard for me to respond on twitter to this!
    I’d say that CAR’s general sentiment was that MLSs should be afraid of new entrants, and be concerned for their own future, and that “help” is on the way in the form of the NAR Cavalry.
    This sentiment is not at all shared by the various MLS attendees whom I’ve spoken with so far.

  5. me says:

    One mls and the new VOW rules will lead to the complete commoditization of realtors. The low barrier to becoming a realtor and the fact that all realtors will operate in the same way using the same software means that realtors will be plug-n-play replaceable parts that will compete on price. Also the franchise brokerages are only going to be able to fool society that their gold embossed logo means something a little longer. Inevitably, people will realize that all realtors are the same and it doesn’t matter if they have a blue logo or green or gold. Also as consumer’s become real estate experts they will not need to pay large commissions for experts. This is a terrible industry to be involved in. It is not a matter of if most realtors will go out of business, but how soon. I say about a year after the integration into calredd, which is when the vow solutions should be everywhere also.

  6. Right on the mark…particularly the ‘monopolistic bureaucracy’ observation. It’s an old NAR tactic which doesn’t belong in today’s world.

  7. Doug Garner says:

    WOW “me”, Why don’t your tell us how you REALLY feel. I’m very sorry that someone has rained on your parade. I haven’t heard that take on the industry before. While I don’t share your sentiments, AT ALL, I do believe there will be an ever increasing gap between agents who can deliver real value and those who are just going through the motions. And, just for the record, if you want to be taken seriously, use your name.

  8. Right on, Doug. Why do people leave comments anonymously?

  9. Ron Stephan says:

    I think CALF is using he fear factor to generate an urgent need and is going about creating the value for its members in the wrong way. The MLSA product in Florida consisting of 60 MLS’s provides a much needed reduction in cost and a wonderful service for brokers on the edge of MLS boundaries. By having the local MLS’s control the amount of data provied to MLSA and by guaranteeing the compensation brokers on the edge now can provide their sellers wider visibility for marketing their listings t those that count most……..other brokers. Until Zillow gets their act together by cleaning up the duplicate listings, outdated listings and inaccuarte listings they will never be competition for a well managed BROKER, AGENT, MLS or MLS datashare website. Consumers know how to seek out websites that provide accurate timely and up to date information.

  10. Doug Garner says:

    Fear? I understand that Joel’s presentation may have come across as trying to instill fear amongst Realtors. Fear of loss is always a better motivator than opportunity of gain. Trying to change the opinions of a huge group of brokers and agents is like trying to turn around a coal barge in the Ohio River, it might be possible, but it ain’t easy. We shouldn’t fear the other guy, we need only to fear ourselves and our unwillingness or inability to change.

  11. Mark Scheel says:

    Fascinating conversation going on. Thanks Michael for bringing it to those that can’t be there in person. Innovation will win in the end, you can’t contain it forever. Who will innovate and how, and win, is very much up for debate!

  12. Sean Patrick says:

    I agree with Doug. We need to be open-minded and willing to change. This is an ever-changing marketplace, and if we arent prepared to make some changes, we risk being left in the dust.

  13. I was there and agree with Mike that Joel Singer used classic bogeyman scare tactics. Several people commented that his presentation was insulting and condescending. Joel said their is no competition in MLS today, but a statewide MLS would somehow bring more competition? Maybe I dozed for a moment and missed a slide… One person said they felt “dirty” just by being in the audience. California has some of the most efficient and progressive MLSs in the country, and the best model for data sharing (CARETS has over 100,000 agents sharing listings – and effectively MLS of choice – which is genuine competition for all those agents) yet we have their state leader telling a national audience that if Cali doesn’t have a statewide MLS run by CAR’s FOR PROFIT division, and develop cool iPhone applications by yesterday, they are all going to be out of business? I’m sure I missed a slide or two…

    Using a distinctly different style, Dale Ross delivered a remarkably similar message, but of national scale. He gently explained that there probably will be a national MLS one day, and RPR would more than likely morph into a national MLS over time, like maybe 10 years or so. Dale was candid, disarming and very credible – not at all confrontational or condescending. NAR picked a great person to deliver the message. Remember, Dale founded and ran MRIS for many years and actually has real world MLS experience. Many people in the industry want to cooperate to adapt, compete, and better serve the member, and in my opinion they’re more likely to cooperate with somebody that isn’t calling them a dumb ass… Stay tuned – I think I like this topic and will have a bit more to say later.

  14. Russell Shaw says:

    I do see the need for regional MLS systems but don’t see how a state-wide MLS for a state the size of California would do anything to help agents serve the public. I believe the agents and companies who would be in favor of a statewide or national MLS would be the same agents who think the value of an agent is “putting it in MLS”.

    I tend to consider brokers and agents and “industry leaders” pushing for a national MLS to be in one of three categories:

    1. They are personally thinking they can profit from selling or managing such a system.

    2. They are idiots who can’t think clearly.

    3. They knowingly intend to destroy the real estate business as we know it.

    There have been so many attempts to “nationalize” the MLS – completely taking it away from Realtors – and having all MLS’ combined under just one organization would make it possible for a single ruling by a single judge in a single federal court room for that to become a reality.

    Just because someone else wants to hang us is no reason to put our own neck in a noose.

  15. Gregg Larson says:

    Interesting observations, Russell. I am doing a presentation at the NAR meetings to the MLS Executive Forum and will share your thoughts with that group. I’m from Scottsdale, so I know you are a top producer in AZ, and its good for people to hear your perspective.

  16. Russell Shaw says:

    Thanks, Gregg. I can’t help but feel that the real reason NAR is even working on the Real Property Resource is to bring a national MLS in the back door.

    If that is the case, I have to say I don’t like it one bit. Is there really any other rationale for even having a *national* property resource?

    Can anyone enlighten me on this? As in WHY are they working on it at all? What problem will it solve? How will it help Realtors? When would I need to look up specific property data about houses in other states?

  17. Russell, I think you’re right, a national MLS is the long term goal of RPR. In fact, Dale Ross and the other spokes-people have as much as said that. The basic phrasing they use is something like: “There is no intent right now to create a national MLS, but the RPR could become one in the future . . . if that’s what the members want.”

    Now, stepping back from that for a bit, and returning to your questions:

    As in WHY are they working on it at all? What problem will it solve? How will it help Realtors?

    I think they’re working on it for two reasons: (1) MLS is critical to the NAR and lots of people were talking about the death of the MLS a few years ago, and so the NAR put its wheels in motion to address that strategic concern; and (2) even though the claims of the death of the MLS once again appear greatly exaggerated, the momentum of an organization like NAR is too great to stop or even slow (actually, the project is really just starting to get steam), even if they wanted to try to stop it, which I doubt is the case.

    Lest my comments appear negative, I do think there are some very important potential benefits to this project. First, creation and promotion of a national system for unique property IDs would help everyone publishing property information tie the data together more accurately. Currently, address, parcel number and lat/long are the methods used, but everyone does this a little different it seems and so linking data is often not easy. A unique property ID system could hep solve that issue, and make linking data easier. Having such a system on a national (or worldwide or, most important, web wide) scale is ideal so everyone uses the same system, making the link love all the more powerful.

    Second, there are plenty of markets where there are multiple MLSs with overlapping borders, requiring brokers and agents to join more than one MLS, pay duplicate fees, and enter listings more than once. Having a national repository could help these overlapping markets. That doesn’t necessarily mean establishing a national MLS, but rather a mechanism for the overlapping MLSs to exchange data with each other as is being done in southern California with the CARETS project.

    Those are my thoughts. It will be interesting to see where it all goes.