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Demystifying the Franchisor IDX Rule / Rescission

November 21, 2011 By Jay Thompson

Apologies in advance to those that couldn’t care less about the inner workings of the real estate industrial complex. This article will likely bore you to tears. We’ll return to our regularly scheduled programming shortly. However, if you are in the real estate field, this may be helpful. Or maybe not. Who knows”¦

If you are a real estate agent who spends any amount of time on the Interwebs, then you have probably seen discussion surrounding the “Franchisor IDX Rule” that was rescinded at the recent National Association of Realtors (NAR) Conference.

Those discussions usually demonstrate general misunderstanding and confusion regarding the rule, and its subsequent rescission by the NAR Board of Directors.

Here is my attempt to demystifying the ruling, the rescission and how that effects agents, brokers and franchisors.

Let’s start with some definitions, as understanding a few terms is crucial to understanding the rule.

Definitions

Franchisor — Here’s one definition from BusinessDirectory.com:

A franchisor is a company that allows an individual (known as the franchisee) to run a location of their business. The franchisor owns the overarching company, trademarks and products, but gives the right to the franchisee to run the franchise location, in return for an agreed-upon fee.

In the real estate space, companies like RE/MAX, Century 21, Keller Williams, etc are franchisors. Brokerages (and agents working at those brokerages) under those companies are not franchisors — they are franchisee’s.

This ruling, and its rescission, affects franchisor sites ”“ think Remax.com, Century21.com, etc. It does not affect individual brokerage or agent sites.

IDX ”“ IDX is short for Internet Data eXchange. IDX is a data feed from your Multiple Listing Service that can be used to display real estate listings on a website (or potentially other means of “electronic display” such as a mobile devices, via social media, etc). IDX rules and policy are established by the NAR and local MLS’s. If you have a “MLS search” on your website, that is IDX. (The MLS can’t actually be searched on an agent/broker’s web site. Only MLS members can search the actual MLS, and that is as it should be ”“ the general public doesn’t need access to EVERYTHING in the MLS, particularly things like showing instructions, gate codes, lockbox codes, etc.)

With an IDX feed, agents are able to display listings from any broker that does not opt out of using IDX (and most brokers do not opt out, at least in the Phoenix area).

Syndication ”“ there are multiple real estate search sites out there (like realtor.com, Zillow, Trulia, Homes.com, etc) that allow you to send them your listings for display on their sites. There are even services that will send your listings to multiple real estate search sites. That is syndication ”“ sending your listing data to a real estate search site for publication on that site.

Syndication is different than IDX. With IDX, you are displaying your and other brokerages listings on your web site. With syndication, you are sending YOUR listings to another site for display there. You can not syndicate another brokerages listings (and your broker could, if they so desire, not allow you to syndicate your own listings. Remember, the listing actually belongs to your broker. They are free to tell you how and where it can and can not be displayed.)

History of the Franchisor IDX Rule

At the 2010 NAR Annual Conference, the NAR Board of Directors added a rule the the MLS policy to allow franchisors to display IDX data on their franchisor web sites. This is the rule in its entirety:

Participants may provide IDX information to their real estate franchise organizations ("franchisors") to be indexed for display on franchisors’ websites. For purposes of this policy, "real estate franchisor" is defined as a company granting real estate brokerage franchises under the franchisor’s trademarks pursuant to a franchise disclosure document meeting applicable Federal Trade Commission rules. Display of IDX information by franchisors is subject to the following requirements and limitations. Failure of a franchisor to comply with the following requirements and limitations can, at the discretion of the MLS, result in suspension or termination of the participant’s(s’) authority to provide IDX information to the franchisor:
1. Initial search results that provide minimal information (e.g., "thumbnails") are exempt from MLS required disclosures (e.g., listing firm, listing agent, source of information, notice that information is deemed reliable but is not guaranteed accurate) provided that a direct link to a detailed (“full view”) display that includes all required disclosures is provided.
2. Consumers can link directly to the detailed ("full view") display that complies with MLS disclosure/display rules of the source MLS.
3. IDX information is not used for any unauthorized purpose.
4. Inaccurate or incomplete information related to any listing is promptly corrected by the franchisor at the request of the source MLS.
5. No advertising may appear on pages displaying IDX information.
6. IDX listing information will not be notified, manipulated, or permanently retained.

What that means in English ”“ Franchisors (C21, RE/MAX, KW, et al) could pull an IDX feed from any of their brokers and display them on the corporate web site (Remax.com, Century21.com, etc), in effect displaying listings from ALL brokerages on their sites, even if that broker was not a franchisee.

At the 2011 Midyear Conference, the Franchisor IDX rule was amended to require that brokers “opt in” to having their listings displayed on franchisor sites. So, if a broker decided they wanted their listings displayed on franchisor sites, they had to expressly opt in to that program. (See this article for more details and why I chose to opt in to franchisor display of IDX data.)

Fast forward to this years 2011 NAR Annual Conference that just recently concluded.

At that conference the MLS Committee voted to recommend to the Board of Directors that the Franchisor IDX rule be rescinded. Removed, killed off, eliminated. The crux of the thought was that Franchisors are not members and participants in the MLS, they aren’t brokerages, so they really aren’t entitled to the use of IDX data.

And the way the MLS and IDX policy are written, that’s a true statement.

So away it went.

“But Jay, third party listing sites like Trulia and Zillow have an IDX feed! Why not franchisors?”

But they don’t have an IDX feed. They get their listing via syndication (see above). Brokers can send them a “feed”, but it’s not an IDX feed and they can only send their own listings, not *every* listing in the IDX feed.

Look for franchisor sites to become syndication channels, soon. They want more listings on their site. Heck, I want my listings on their site and yes, I will syndicate them to them as soon as I can.

Why? Why would I want my listings on Remax.com and other franchisor sites?

For the same reasons I mentioned in this article about a large regional brokerage pulling their listings from some third party sites. It’s all about exposure. And as a small independent brokerage, if any of my agents ever get this question from a seller:

But if we go with a Century 21 agent, then our home will be displayed on Century21.com. That’s a big site with lot’s of traffic!

They can answer with this:

List with us, and your home *will* be displayed on Century21.com and tens of hundreds of other real estate sites as well.

I don’t buy the somewhat prevalent, “big franchisors will have an advantage over the little guys if we let them display IDX data!” argument. I *am* a little guy. I *want* my data on their sites. Some think they will use that data to smack me down in search engine results. Whatever. That’s the same argument I hear about third party listing sites. We can hold our own in the SEO battle against the third parties, and we can hold our own against the franchisors. I say bring it.

The Bottom Line

Franchisors can no longer pull an IDX data feed from their brokers into their franchisor web sites. Honestly, this isn’t that big a deal because once they become syndication channels, and in my opinion they will very soon, they’ll have a way to display non-franchisee listings. We will be there. So will many others. Some will chose not to do that, but those brokerages wouldn’t have opted in to franchisor IDX either.

Nothing in the rescission of the franchisor IDX rule changes how agent and broker sites currently utilize IDX data.

What might change how agents and brokers utilize IDX data is the fact that for the fourth time in the last three years, an NAR committee or Board of Directors has sent recommended revisions to the IDX policy back to a small work group to hash out potential changes to a policy that is in dire need of revision. Who knows what may come out of that work group, or how the MLS Committee, the Executive Committee and/or the Board of Directors will react and respond to any proposed change at the 2012 Midyear meetings.

But franchisor IDX? Forget about it. Stop worrying about it. Watch for when franchisors become syndication channels (and trust me, they will let you know) and decide if you want in or out. It’s really that simple.

An aside ”“ on ”˜controlling the data’

Trust me when I tell you the subject of “controlling the MLS data” comes up frequently in any discussion on any level about changing MLS or IDX policy. It seems there is a significant number of agents and brokers that feel if brokers could just sink their claws into MLS data and control rigidly who had access to it then all the evils of the world would be resolved and we in real estate sales would all magically become ridiculously prosperous. I’ve talked to brokers that think we collectively blew it when we allowed listing data to escape our grip and be put to use outside of our direct control.

What a load of hooey.

If as an agent or broker you think the only value you bring to a real estate transaction is MLS data, then I have to respectfully suggest you find another line of work. Our value isn’t in the MLS data, our value is in the service and expertise we bring to home buyers, sellers and investors. Sure, we need MLS data to help us do our job, but it’s the understanding, use and interpretation of that data that matters. Data without expertise, without the ability to analyze and interpret the meaning, is useless. Today’s consumers demand access to information, and as the creators and curators of that information, we owe it to the consumer to deliver it. Keeping the data behind a closed system in the name of “control” is essentially a waste of time ”“ our time, and the time of home buyers and sellers. Rather than attempting to stuff the escaped genie back in the bottle, rather then try to change consumer behavior, we should be embracing it, and using that need for information to our advantage ”“ and to help the consumer. You want to be a kick-ass real estate agent, right? How does controlling data and saying, “sorry, you can’t see this” help anyone? Provide the consumer exceptional expertise and service, that is how you’re going to be a kick-ass agent. Help them, don’t hinder them. Use the data in a way only your experience and expertise allows and stop incessantly complaining about how we’ve lost all control of the data, and therefore our livelihood. Please. Just. Stop. Figure out what value you really add to the real estate transaction, and use that to wow your clients.

Further Info:

If you are a Realtor, you can download the entire 154 page Handbook on Multiple Listing Policy here (realtor.org login required). It includes IDX policy. Fair warning, remove all sharp objects from within reach before you sit down to read it.

Also on Realtor.org (login required. Why, I have no idea. Smacks of “controlling the data””¦):

IDX ”“ Background and FAQs

IDX Information and Resources

An Open Letter to the NAR Multiple Listing Issues and Policies Committee

November 16, 2011 By Jay Thompson

Fair warning, mini-rant ahead”¦

On Saturday at the National Association of Realtors (NAR) Annual Conference, I attended the meeting of the Multiple Listing Issues and Policies Committee (heretofore called simply, the MLS Committee).

Why in the world would I attend that meeting?

Because I’m a glutton for punishment? Because I like sitting around for three hours, battling parliamentary procedures? Because it’s fun to spend 20 minutes debating whether a sentence should include an “and” or a comma?

None of the above, though the “comma discussion” really did take place. I attend the MLS Committee meeting for three reasons: 1) they discuss some pretty important stuff; 2) they establish policies that I (and my MLS) have to abide by; and 3) I’m a member of the MLS Committee.

Yep, I’ve been a member of the MLS Committee since May 2009, and was recently informed that my term has been extended through December 2014.

And it’s been a pretty wild ride.

Frustrating too.

Some observations from the MLS Committee meeting

About 10 minutes prior to the start of the meeting, I was talking to a fellow committee member. Just the idle chit chat two people have before they plop down next to each other for a three hour meeting. She was looking around, obviously looking for something, or someone.

“Looking for something?”

“I’m looking for the guy that tells me how to vote.”

“Excuse me?”

“I wish I understood this stuff. It’s too techy for me. Honestly, I’m clueless and have no idea how to vote on this IDX stuff, so I ask my tech friend what to do.”

I stood there in dumbfounded silence. Here was a member of the MLS Committee, freely admitting they were clueless about “IDX stuff” ”“ the “stuff” that the MLS Committee has been trying to take action on for the last three years.

Then I looked around and saw three committee members opening the envelopes and removing the shrink wrap from the materials that the NAR had mailed committee members about three weeks prior to the meeting.

This material contained the meeting agenda, proposed language changes to the IDX policy, the Report and Recommendations of the IDX Presidential Advisory Group (PAG) and other information.

In other words, it contained a great deal of information on what was to come before the committee.

And committee members were opening it 10 minutes before the meeting.

In other words, they were apparently completely unprepared for the meeting.

My suggestion for MLS Committee members that “don’t get it” or don’t prepare for the meeting

Fire up your email. Put the email address of the MLS Committee Chair in the “To” box. In the “cc” box, put in Cliff Niersbach’s email address. He is the NAR liaison to the MLS Committee. You’ve gotten dozens of emails from both these people, that’s where you’ll find their email addresses.

Now type this in the body of the email:

I hereby respectfully resign my appointment to the NAR Multiple Listing Issues and Policies Committee effectively immediately. I appreciate the opportunity to serve, and wish the Committee future success.

Click “send”.

Seriously. If you aren’t going to take the time to educate yourself on the issues, if you can’t even unwrap the reading materials and READ them prior to showing up for the meeting, then resign. If you aren’t doing these fundamental things, why are you even on the committee?

We are about to enter into our third year trying to address an IDX policy that is outdated. Three years. Surely I am not the only one that feels that is a ridiculous length of time to be working on updating the IDX policy. In the meeting that was just held, the IDX policy revisions were sent back to a smaller group, for the fourth time, to be presented to the MLS Committee at the 2012 Midyear meeting in Washington, D.C.

So an effort that started at Midyear in 2009 will now be resolved, at best, at Midyear in 2012.

And honestly, I have zero faith it will get resolved there. If history is any indicator, the Committee (or the NAR Board of Directors) will push it back to a work group again ”“ and the whole sordid mess will roll into the Annual meeting in 2012, probably only to get referred into 2013 and beyond.

By the time a revised IDX policy finally gets done, there will probably be some new, or obsoleted, technology that has come around and the vicious circle of non-understanding and complacency will start all over.

What could be changed to resolve this?

If I were in charge, and clearly I am not, the first thing I’d do is cut the size of the MLS Committee in half (at least). The 2012 flavor of the MLS Committee will consist of 117 members.

Why does the MLS Committee need 117 members? When I posed this question a couple of years ago I was told that it was for “fair representation” ”“ that the committee needed to be composed of members from various states, MLS’s, large and small brokers, etc.

Okfine. I get the concept of representation. But don’t tell me that can only be accomplished by putting 117 people on the committee. The United States Senate is a smaller group than the MLS Committee and they represent 310 million Americans. The simple fact is, a committee of 117 people is far too large to get anything done. That’s why the real work gets done in PAGs and Work Groups. The problem is, those PAGs and Work Groups have to report back to a 117 member committee who has to discuss and vote on whether or not to forward a recommendation to the 73 member Executive Committee, who then decide whether to send it to the 750 member Board of Directors for their discussion and rejection/approval. Anywhere along that 940 person trail, a parliamentary procedure or a vocal minority or those ignorant of the issue can send it right back to the committee. And since the full committee only meets twice a year, real actions can only happen once every six months, at best.

Yes, you read that correctly. The 2012 NAR Board of Directors is a 750 member body. That’s close to twice the size of the United States House of Representatives. Think about that”¦

It is a wonder, and perhaps a testament to the dedicated committee and board members, that anything gets accomplished.

The second thing I would do is form a permanent IDX Subcommittee under the MLS Committee. Let’s face it, the size of the MLS Committee (or BoD) isn’t going to be reduced. If that were ever proposed, too many people with delusions of power would pitch a hissy fit of epic proportions.

Why a permanent subcommittee? Because IDX (in some form or another) isn’t going away. Because technology changes rapidly. Because some continuity is needed with a small group of people that “get it” so they may cogitate and propose and communicate rules and policy to the larger body that make sense. Yes, work groups and PAGs can be formed, but those groups lose continuity with their frequent formation and subsequent sunsetting. To be fair, there was some member overlap across IDX work groups and PAGs, but consistency in membership seems to be lacking. (For example, I served on two work groups, but not the PAG. There were PAG members that served on work groups. There were also PAG members that were not on either IDX Work Group.) Creating a subcommittee with staggered terms would allow far greater consistency than having work groups and PAGs formed from twice yearly meetings.

These IDX issues are tricky, and not easy to understand. An IDX subcommittee, made up of existing members of the MLS Committee (fully vetted so those with appropriate knowledge and experience are appointed) and other experts in the field, would allow a consistent group to address issues in a more timely fashion than having the MLS Committee creating a new work group every six months. If some issue or new technology pops up between the twice yearly meetings of the full committee, the subcommittee, already formed, could address them in a far more timely manner than waiting for the full committee to create yet another work group.

Although it shouldn’t matter, I suspect a “subcommittee” might have more pull and influence than a “work group”, or even a “Presidential Advisory Group”, lofty as that title sounds. If nothing else, full committee members would at least know who was on the subcommittee, and the communication lines might be more open.

And let’s face it, communication seems to be a sticking point here. Despite the committee leadership and NARs Herculean efforts to get the word out about what will be discussed at the MLS Committee meetings, it is painfully apparent that far too many members are either paying no attention, or don’t have the experience and skill set to comprehend the issues. I’m sorry if that last part seems harsh, but let’s call it like it is:

There are too many people on a committee too big to work effectively that don’t understand enough about the issues to make educated decisions.

Points in support of that statement:

At the recent MLS Committee meeting, two corporate executives, Saul Klein CEO of Point2 Technologies and Luke Glass, VP and GM of ListHub, were called in to educate the committee on the differences between IDX and listing syndication. Sorry, but if someone doesn’t understand the differences between IDX and syndication, they aren’t qualified to be voting on IDX policy that can fundamentally shape and change the ways we conduct business.

RSS Feeds. After years, yes years of floundering in the work group / PAG / committee ether, the ability to send listing data via RSS would appear to be removed from consideration in the future IDX policy, based on a decision made by the MLS committee (and approved by the BoD) at this meeting. Why? Because people are afraid of, and ignorant of, RSS. The popular argument is “it’s difficult to control access to RSS feeds” or “RSS feeds can be scraped and repurposed by evil people intent on destroying the real estate industrial complex”.

Well, yes they can. So can information on ANY web page. Don’t believe me? If you are on a PC, right click your mouse (Control + click on a Mac) and you’ll see “View Page Source” or something similar depending on your browser. There’s the code to this web page, which can be copied and pasted, manipulated, and aggregated for evil purposes, just like RSS. In a few minutes, a first year computer science major could whip up some code to scrape any web page or site on the planet. Don’t know a CS major? Just Google “download website” and you’ll find a host of tools and methods to download and copy entire websites ”“ data with which pretty much anyone that wanted to could manipulate for their evil ways.

The only way to keep IDX data 100% safe from people bent on misusing it is to keep it off the internet completely. Yet no one questions or expresses concerns about the IDX data being online, they only question it when they don’t understand the form and function of said data.

(OK, even that isn’t 100% safe. Agents give out their MLS usernames and passwords all the time. Sad as that is, it’s true. If some evil entity really wants access to the MLS data, I can assure you there are agents out there that would help them get it.)

All the disallowing of putting IDX data into a RSS feed does is hurt consumers that use RSS (and agents that use RSS in order to get IDX data indexed in Google). It doesn’t “protect” the data, it just hurts consumers and agents ”“ that is what the MLS Committee and NAR Board of Directors just approved.

Seems”¦. wrong.

In Conclusion (finally)

MLS Committee members need to understand the issues they are voting on. While that seems stunningly obvious, it’s clear that many (but certainly not all) do not.

I think an IDX subcommittee would be helpful.

The NAR needs a new IDX policy. It is long overdue. Whether that policy includes the use of IDX data in the social media space or not is up to the latest (yet to be formed) work group to propose. Personally, I think they should scrap the entire existing IDX policy and start all over with a comprehensive new “electronic display” policy and associated rules.

Such a policy is not an easy thing to craft. Technology and the tools available to display IDX data change frequently. Creating rules and policy to cover every possible iteration of ways to display IDX data that is generic enough to cover every possibility while specific enough to provide reasonable guidance for MLS’s, Associations and brokers to interpret will not be an easy thing to do. Perhaps rather than having work groups and PAGs working on this issue in one day meetings twice yearly, an IDX subcommittee could be locked in a room for several days until they can bang it all out. Then that proposed IDX policy and rules would need to be made available in multiple formats ”“ hard copy, email, webinars ”“ and MLS Committee members be *required* to read the material, well before the time comes to vote. A “Q&A” site could be established so that MLS Committee members (and anyone else for that matter) could propose questions and concerns to the Subcommittee. And *then* after feedback, questions and concerns are gathered, the Subcommittee could reconvene to discuss and possibly revise the policy and rules before the full committee meets and votes. Rules and policies of this magnitude will rarely be gotten right on the first pass ”“ we need an opportunity to fine tune the rules and policy prior to voting. That time is NOT in the MLS Committee meeting.

Please don’t get me wrong. There are MANY extremely dedicated and qualified members of the MLS Committee that work very hard, give up inordinate amounts of personal time, and spend their own money going to meetings — all in an effort to do the right thing.

But something has to change. What’s happening now, what has happened for the last three years, clearly isn’t working.

It’s time to do something different.

Photo Credit: Yours truly. On Flickr.

An Interview With Justin LaJoie on the Zillow Acquisition of Diverse Solutions

November 8, 2011 By Jay Thompson

Last week’s announcement that Zillow had acquired real estate search provider Diverse Solutions caused a bit of a stir across the real estate vertical. Much speculation ensued, along with the requisite Zillow bashing that seems to take place any time Zillow makes another splash in the industry.

I’ve known the Diverse Solutions founder and CEO Justin LaJoie for a few years. He’s a good guy, crazy smart, with terrific products (we use the DS products dsSearchAgent and dsIDxpress products on this site). I also know Zillow CEO Spencer Rascoff, also a good guy. Also crazy smart.

I asked Justin if he would mind answering a few questions “on the record”, and he graciously agreed. My thoughts on the acquisition are below Justin’s comments, for what that is worth…

What does the acquisition mean for existing customers of dsSearchAgent, dsSearchAgent Mobile and dsIDXpress? Will these products continue to be offered, supported and developed?

The acquisition means that Diverse Solutions will continue to provide the same dedication to innovation and great support customers have come to expect, but with accelerated growth and advancements for our product offerings. We do not expect any interruption to the service our customers receive from us today. However, with the added resources from Zillow, we will be able to more quickly develop new enhancements.

Let’s be honest, there is a certain level of “Zillow Bashing” (and even fear of Zillow) that has taken place in the real estate community since the day Zillow was launched. Does this attitude/fear concern the Diverse Solutions team?

Like any company considering an acquisition, we initially had questions about compromising on our customer service and products. But Zillow understands our value to the industry and we are working together to ensure we stay true to our customers.

Some agents have already expressed that they will be dropping DS products due to this acquisition. What do you say to those individuals?

Diverse Solutions and our products will be getting even better. Don’t make any knee-jerk reactions and give us a chance to prove that to you.

DS has agreements with many MLS’s for IDX display of listing data. Does the acquisition now give Zillow open access to that IDX data and let them do as they please with that data?

Absolutely not! Diverse Solutions will continue to operate under our data agreements with MLSs and the industry; which means that Zillow will not automatically be displaying listing data on their site or mobile apps. If we do not follow the rules then we no longer get the data feeds.

Will the DS operations be transferring from their current location in southern California to Zillow’s headquarters in Seattle?

No, all Diverse Solutions including myself staff will be staying in Irvine, Ca. I do think I will be doing some more traveling to Seattle than I have done in the past though.

Will DS product pricing and availability be changing as a result of this acquisition?

It’s business as usual.

Some people have expressed concerns to me that Zillow widgets, advertisements and other such items will be integrated into DS products and these additions will link back to Zillow — potentially diluting their own search engine placement efforts. Can you confirm or deny this possibility? If “Zillowish” features were to be added to the DS products, would the user be able to “opt out” of those additions?

Our objective is to offer products that real estate agents and brokers want to use. If we load them up with a bunch advertisements and backlinks then that will diminish the appeal and effectiveness of the products. Our goal is to partner with more agents and brokers to use our services. Not drive them away. However, given that Zillow has so much great data, we’d like to bring some of that to future enhancements of our products. We’ll be working on this and similar issues in the coming months and will do what’s best for both Zillow and Diverse Solutions’ customers.

I think some are concerned that your focus will shift from serving your client’s needs to serving Zillow’s needs. Is that a valid concern?

Zillow wants us to continue to be successful. They did not acquire Diverse Solutions to slowly kill it and the products that we have developed over the years. In fact, it is just the opposite. We have the full support of Zillow to continue to develop and run Diverse Solutions like we always have.

I have heard speculation that Zillow acquired DS so they could shut down their products and remove DS users as players in the “search engine placement war.” Can you say anything to alleviate those concerns?

This would be a giant mistake if Zillow had these feelings, which they do not. We want to help agents and brokers be successful. This acquisition is about expanding the suite of tools and marketing opportunities we can offer real estate professionals.

You’ve been named Zillow’s Vice President of Industry Solutions. Can you expand on what that position means for Diverse Solutions, Zillow and you?

For Diverse Solutions that means business as usual. I will still be running Diverse Solutions like I always have. I will just have additional responsibilities at Zillow that include managing current and future products that are made available to agents and brokers throughout the nation.

Any final thoughts you’d like to share with our readers?

Everyone here at Diverse Solutions, including myself, are very happy to be a part of the Zillow family. Know that Diverse Solutions always will have the best interest in mind for agents and brokers. We are here to make the best possible products and provide the best possible service that we can. There will be a lot of improvements coming and we can’t wait to share them with everyone and prove the naysayers wrong.

My Thoughts on the Diverse Solutions Acquisition

Personally, I think this is a smart move on the part of both parties. Diverse Solutions can tap into Zillow’s support network, and money. In theory, this could allow Diverse to provide better customer support (the one area they might have been previously lacking in) and access to the almighty dollar, and a bevy of Zillow coders, could result in new and innovative product offerings. Zillow gets a leading IDX search provider with some top notch people (coders included), an additional income stream, a kick-ass product to offer agents and brokers, a strategic future positioning, and possibly an opening into working more closely with Multiple Listing Services in the near future.

I for one have never understood the propensity that some agents have for Zillow hating. I don’t believe for a second that Zillow set out from Day 1 to disintermediate real estate agents. Their Zestimate — a computer algorithm that estimates a home’s market value — is not inherently evil. In fact, I *love* it when home sellers bring up Zestimates as it provides a wide open door to walk through and allow you to demonstrate your experience and skill. No Automated Valuation Model can replace human skill and experience, so to fear a Zestimate is just silly. Use it to your advantage and cut the “woe is me they are out for my job” rhetoric.

I have no idea what Zillow’s ultimate plan is for Diverse Solutions. I don’t buy into the conspiracy-like theories that some are spreading — disintermediation, shutting off Diverse products or adding links as an SEO play, whatever. It looks to me like Zillow acquired a terrific real estate tech company for a pretty good price and Diverse got a partner with a large presence, staff and funding.

Only time will tell the whole story.

I’m sure Justin will be watching this post for comments, probably Spencer too. So if you have a question, fire away. Just keep in mind that Zillow is a publicly traded company, and its executives can’t answer some questions, particularly “forward looking statements”. That’s not the fault of Zillow, Diverse Solutions, Justin or Spencer. It’s not a conspiracy theory. If you want to blame someone for them not being to answer some questions, blame the Securities and Exchange Commission.

More on the Diverse Solutions acquisition by Zillow:

Diverse Solutions Blog
Zillow Blog
Zillow Press Release
Rob Hahn opines
GeekEstate Blog

Photo/Logo credit: I’ll admit it, I swiped it off the Zillow blog. I don’t think they’ll care. And I know they will let me know if they do.

Midyear Missive: Thoughts on RPPSI, display of listings on social media sites, and the Franchisor IDX policy (and why I will opt in)

May 15, 2011 By Jay Thompson

Fair warning: Long post ahead”¦

Three days of this week were spent in Washington, D.C. attending the 2011 Realtors Midyear Legislative Meetings and Trade Expo (more commonly referred to as simply “Midyear”).

This promised to be a lively event as there were some major issues on the table: RPPSI, “Franchisor IDX” and “Display of listings via RSS and Social Media”.

Thoughts on RPPSI

“RPPSI” the “Realtor Party Political Survival Initiative” was hotly debated prior to Midyear. The overwhelming sentiment online seemed to me to be against this initiative and it’s $40 dues increase. Today however, the NAR Board of Directors “overwhelmingly approved” the initiative and dues increase. This is exactly what I thought would happen when I wrote, Op-Ed: The Realtor Party. NAR Proposes the Realtor Party Political Survival Initiative.

I’ve been told there was very little debate on RPPSI at the Board of Directors meeting. I don’t know what was said there, I flew home before that meeting. What I do know is there was definitely discussion of RPPSI at Midyear. I heard it in the hallways, and had several discussions myself with several people. In addition, many Associations had discussions and round tables prior to Midyear. So the folks that are claiming the BoD and “leadership” weren’t discussing this, or that passage was “pre-arranged” or “rubber stamped” are mistaken. Still, given the scrutiny, public outcry and potential impact of this change, an open public debate and discussion at the BoD meeting seems appropriate. I know for a fact there were directors opposed to this. Why they didn’t speak up, I have no idea.

That said, I’ll stand by what I said in my original op-ed ”“ there are a lot of Realtors out there that have no clue RPPSI exists and a dues increase just happened. I’ve been in meetings prior to Midyear where the topic of RPPSI came up and there were many, MANY agents and brokers that said, “RPP what?” They’d never heard mention of it. Yes, it’s been all over the “re.net” and Twitter, and even Realtor.org. But as much at those of us connected online want to think it, the simple fact is a very significant proportion of real estate professionals are very disconnected from the net and many pay little attention to communication they receive from their local, state and national associations. They will pay attention when they get the tab for 2012 dues and say, “What the heck is this forty bucks for?” Too late now to change it.

For the record (for what that is worth), I am no fan of RPPSI. It’s not the $40 ($80 for us as Francy and I will both pay). It’s the fact that the NAR will be donating my money to political candidates that I may be partially or wholly opposed to. NAR’s early pat answer to that particular issue seems to be “less than 30% of the money collected” will go to individual candidates. And that, “Much more will go to mobilization, advocacy, and campaign-coordination efforts around state, local, and federal issues that affect real estate, ranging from the mortgage interest deduction to transfer taxes”

Well, “mobilization”, “advocacy” and “campaign-coordination efforts” can all still, albeit indirectly, go to getting a candidate I do not support being elected.

In my opinion, it smacks of unionization and signifies a fundamental shift in the nature and purpose of the NAR.

But it’s a done deal, and the only choice I have if NAR gives money ”“ directly or indirectly ”“ to a candidate I don’t support is to give even more money to a candidate I do support.

Well, I guess we could drop out of the NAR, but for us, that would also entail dropping out of the MLS, which isn’t much of an option.

The Display of Listings via RSS and on Social Media Sites

Lost in the hubbub of RPPSI and the “Franchisor IDX” debate was a proposal made at the Multiple Listing Issues and Policies Committee that allowed, under certain conditions and stipulations, for listings in compliance with IDX (Internet Data Exchange) policy to be displayed via RSS and on social media sites (I’m paraphrasing here, it’s a complicated thing). I am on the MLS committee and have been on the workgroups assigned to discuss, debate and develop these policies. In fact, I’ve been on the committee and the workgroups for going on two years. Two years that we’ve tried to get this policy implemented. Today, for the third time in the last 18 months, the full Committee sent the policy back to the workgroup for further clarification.

This is disappointing in that it is a good policy, and a needed one as well. Social media isn’t going away, and policy needs to be established on how it is used in the display of IDX data. My personal opinion is this failed to pass (in a VERY close vote) for three reasons: 1) there are still many members that don’t understand the proposed policy; and 2) there are many members that are ignorant and/or afraid of social media; and 3) people are concerned about the “freshness” and accuracy of listing data on social media sites.

In what was to me a very telling indication of reason #2, one MLS committee member said, publicly, that it wasn’t their brokers job to monitor their social media sites and they wouldn’t even know how to if it was required (paraphrased again, it was a long day). Well, it IS your brokers job and if they don’t know how to do that they best figure it out, or find another job. Social media sites can, and should be monitored for compliance.

The issues with using RSS seem to be primarily around the fear that IDX data could be “scraped” and repurposed for nefarious deeds. Again this shows that people don’t really understand the technology. For those bent on stealing data, HTML isn’t much more difficult to steal then the XML of an RSS feed.

With regard to “freshness”, I wondered out loud why so many seem to have concern about a social media site showing outdated info but the same concern doesn’t come up with print advertising. MANY magazines show properties for sale that were sold months ago. The listings in the Sunday paper can easily show a list price that was reduced after the ad was printed. The responses I got were, “People know what date the paper was printed on,” or “the internet is permanent, newspapers are not”.

Those counter-arguments don’t fly. 1) Tweets and Facebook posts are time stamped. You know when they are posted too, just like the publication date of a newspaper. 2) Yes, the internet is “permanent”, but the vast majority of social media posts are quite transient. If you don’t believe that, I challenge you to go try to find something that was Tweeted or Facebooked six weeks ago. Good luck finding something posted six days ago (or heck, even six hours). I can’t easily find something I posted that I *know* is there. The argument that some poor consumer might stumble across a listing that was tweeted last month and think that info is still current is ludicrous on two accounts: 1) no one is going to go back in time looking at old Tweets and Facebook posts; and 2) let’s give consumers a little more credit than we are. They know darn well whether or not they are looking at old data. After all, they’ve clicked “Older posts” or worn out the scroll button finding it.

So back to the workgroup it goes, this time with the charge to investigate creating a separate policy for social media sites. What the workgroup had done, was attempt to modify the existing IDX policy to include all methods of “electronic display”. Think websites, social media sites, mobile, whatever. IDX rules require certain things to be displayed, primarily the listing broker, the MLS logo, and various other items. On “micro blogging” sites and mobile phones, there are space limitations that prevent showing all the required info. The revised policy addressed that issue by requiring a link to a fully compliant display be included.

The Franchisor IDX Policy

This was apparently a hotly debated topic at both the Executive Committee and the Board of Directors meeting. I can also personally attest that the aforementioned MLS committee workgroup I was a part of thoroughly discussed the situation as well.

In a nutshell, the “Franchisor IDX” policy was voted on back in November 2010 and became effective Jan 1 of this year. What it does is allow franchisors to post, and index, IDX data on their web site from any MLS where they have an operating franchisee.

Or, in plain English, a real estate franchisor ”“ say Century 21 ”“ can put IDX listings on Century21.com from any MLS as long as they have a franchise office in that MLS. I suspect the mega-franchisors like C21, RE/MAX, Keller Williams, etc have offices in all 900 some-odd MLS’s in the country. So under this rule they can (and have already started to) display IDX listing data on their corporate sites. That means a brokerage like mine for example, which is independent and not a franchise, could have our listings posted on Century21.com, Remax.com, etc.

Personally, I’m OK with that.

But Jay! That means some Century 21 agent might get the lead for your listing!

So what? Good!

We take listings for one purpose ”“ to sell them. We don’t take listings to “generate leads”. If one of our listings gets posted to C21.com and a potential buyer sees it there and that buyers info gets routed to a Century 21 agent, then that’s a GOOD THING. I don’t even want “leads” for our listings coming back to us as personally I abhor dual agency in virtually all situations.

I simply don’t understand the somewhat pervasive attitude of “if our listings show up on site X, Y, or Z then we may not get the leads.”

How does this conversation pan out?

Joe Realtor: Now I could set your listing up to be shown on national real estate franchisor sites like Century21.com, Remax.com, and KellerWilliams.com. But I’m not going to do that.

Sally Seller: Uhm, why not? Wouldn’t that get more exposure for my home? Isn’t exposure on the internet a good thing?

Joe Realtor: Well, yes that is all true. But you see, if I put your listing on those sites, I may not get any leads that might be generated from exposure on those sites.

Sally Seller: Oh. But I thought your job was to sell my home, not generate leads.

What does Joe Realtor say now???

I have no idea, but I certainly don’t want to be a part of that conversation. Sally Seller deserves to have her home listed on as many sites as possible that may attract the eyes of potential buyers.

Some folks are saying that if we (“we” collectively as in the NAR membership) open up the ability for real estate franchisors to display IDX listings than that opens the door to third-party sites such as Zillow and Trulia (national listing aggregator sites) and Facebook and Google to “get the information too”. I suppose that would be true if those sites decided to abandon their business models and become real estate franchisors ”“ and open real estate franchise brokerage offices all across the country. Personally, I can’t see that happening. Besides, Zillow and Trulia already display listings, primarily from brokers syndicating their listings to them. If you don’t want your listings displayed on the “Truzillias” of the world the solution is simple ”“ don’t syndicate your listings to those sites. Google is full of hundreds of thousands of search results that lead to listing information. Uhm, good. That’s how many buyers find homes to purchase. Facebook? Meh, I’m not convinced that people go to Facebook to search for homes, but if they do, I certainly don’t care if they find our listings there.

Yes, yes, I understand that brokers “own the data”. And of course it’s critical that listing data be accurate. That is exactly why the workgroup put into the policy that any IDX display on social media sites, RSS, and franchisor web sites be linked to the original page ”“ which is updated from the MLS on a regular basis.

Unfortunately, there seems to be a great deal of misunderstanding out there about what this policy says, and what has gone in to developing it. A significant contingent wanted the policy repealed at Midyear. The MLS Committee voted to suspend the Franchisor IDX provisions, and form a workgroup to further review the policy and bring recommendations to NAR’s Annual meeting in November. This went to the Executive Committee, which elected to keep the policy in affect, but allow a broker to “opt out” of displaying listing data on franchisor sites. When the Board of Directors took the matter under consideration, they ultimately passed a motion that kept the policy in place and provided brokers the opportunity to “opt in” to display.

I’ll take that opportunity. Others likely will not.

Unless brokerages and the NAR want to just outright ban listing data displays across the internet in its entirety, there is no way to ensure that data won’t be used by evildoers, stolen, manipulated or be incorrect. Data is entered by humans, and humans make mistakes. The internet isn’t going away. We can set policy that limits and restricts what NAR members can do with IDX listing data, but we have zero control over what third parties do. The IDX policies developed by the workgroup and proposed to the MLS committee are an attempt to control what can be controlled, limit potential of abuse and errors, and allow the NAR membership to compete with third-party sources. That’s good for brokers, good for agents, and most importantly, good for potential home buyers and sellers.

2,401 words. Good grief. If you’ve read this far, congratulations! If you’ve read this far and are still confused, that’s understandable. It’s complicated stuff to grasp, and not easy to explain. For more reading on the background of these issues, and what happened at Midyear, I recommend these articles:

Rob Hahn:
Midyear Reports: Breaking News from MLS Policy Committee Meetings
Midyear Reports: On the Franchise IDX Decision
Midyear Report: First Take on Board of Directors Votes

NAR:
RPPSI ”“ Board of Directors Update
RPPSI FAQ – You May Not Like It, But ”˜Politics as Usual’ Have Changed
NAR Internal News Service on Board of Director Actions

Photo: By yours truly. More D.C. photos on Flickr.

Beta Testing the Flexmls IDX Plugin for WordPress

January 17, 2011 By Jay Thompson

UPDATE: The plugin is out of beta and is now available! See the FlexIDX WordPress Plugin site for details.

For the last week, I’ve been beta testing a new WordPress plugin that our MLS provider, Flexmls, will be launching soon.

The plugin offers several cool features such as ways to generate and “widgetize” market statistics, a listing photos, searches and contact forms.

You can see some of what it does on this Phoenix Real Estate Listings and Market Stats page, or this Gilbert Homes for Sale page. These pages by no means have every feature of the plugin implemented, but they will give you a good idea of the power and flexibility the plugin offers.

More information and demos can be found on the website Flexmls is developing for the plugin.

If Flexmls is your MLS provider, and you use their IDX solution (which is very good by the way. It’s on this site as our “Advanced Phoenix Home Search”) then you may want to keep your eye out for the release of this plugin ”“ assuming of course you’re running a WordPress site.

There is a ton of potential in something like this. We’ll be exploring it further. If you want to follow along I’ll be putting new pages under the “Beta Stuff” menu up in the nav bar. Flex has been *super* swift to respond to feedback and bug fixes, so I suspect it won’t be long before this is released for consumption soon. I’m not sure what exactly the pricing will be, but it wouldn’t surprise me if someone from FLexmls doesn’t stop by and chime in with release and pricing info.

The plugin widgets are as easy as dragging and dropping into your sidebar, and there is a short code generator that’s very easy to use to build pages like I linked to above.

Highly recommended!

We recently added the beta version of Diverse Solutions upcoming revamped IDX search and now this beta of the Flexmls IDX plugin. Hopefully we don’t have a beta blog blowup (ooh alliteration!) happening soon. But hey, if you don’t try new stuff and push the envelope you’ll fall behind swiftly!

Demystifying the Franchisor IDX Rule / Rescission

Definitions

History of the Franchisor IDX Rule

The Bottom Line

An aside ”“ on ”˜controlling the data’

An Open Letter to the NAR Multiple Listing Issues and Policies Committee

Some observations from the MLS Committee meeting

My suggestion for MLS Committee members that “don’t get it” or don’t prepare for the meeting

What could be changed to resolve this?

In Conclusion (finally)

It’s time to do something different.

An Interview With Justin LaJoie on the Zillow Acquisition of Diverse Solutions

My Thoughts on the Diverse Solutions Acquisition

Midyear Missive: Thoughts on RPPSI, display of listings on social media sites, and the Franchisor IDX policy (and why I will opt in)

Beta Testing the Flexmls IDX Plugin for WordPress

Who is The Phoenix Real Estate Guy?

Recent Posts

Search TPREG

Definitions

History of the Franchisor IDX Rule

The Bottom Line

An aside ”“ on ”˜controlling the data’

Some observations from the MLS Committee meeting

My suggestion for MLS Committee members that “don’t get it” or don’t prepare for the meeting

What could be changed to resolve this?

In Conclusion (finally)

It’s time to do something different.

My Thoughts on the Diverse Solutions Acquisition

Who is The Phoenix Real Estate Guy?

Recent Posts

Search TPREG

My suggestion for MLS Committee members that “don’t get it” or don’t prepare for the meeting