Conversations about the MLS industry, creating software, and employee ownership.

Here’s an email I received today from a member of the Board of one of our MLS customers:

Hi Michael,

I believe you are involved with the Data Standards group at NAR, right? We are still struggling with some definitions and wondering if there is anything published by the data standards group on things that have already been agreed on at the NAR level. Do you have anything like that? Yesterday we struggled with “Single Family Detached” home for over an hour. Is there some help out there?

Thanks, and look forward to seeing you in San Diego.

I typically discuss data standards in relation to MLSs wanting to share data or regionalize, but this is a good example of an MLS simply wanting an easier way to get the data right. I pointed this customer to the RETS schema, but also had to say that it wasn’t user-friendly and didn’t say anything very specific about her question.

From my perspective, a broker asking for a definitive data definition to be published at the national level isn’t too much to ask. I would really like to be able to respond, Yes!, here’s a link to the data dictionary we’ve been working on for the last many years and the definition you’re looking for is on row 28 (or whatever). Wouldn’t that be great? Let’s make it happen.

In my recent post describing the MLS track at Inman Connect on August 6, I wrote that “the future of MLS has a lot more to do with people data than listing data.”  In fact, all the MLS sessions at Inman this year will touch on this movement in focus “from listing data to people data.”  Importantly, this trend isn’t just related to MLSs or real estate.

Wired recently posted an article describing the “full-blown battle” between Facebook and Google “over the future of the Internet.”  The article posits that Facebook is collecting a vast trove of data — people data — behind their walled garden, far away from Google’s search engines:

Hardly any of Wayne’s Facebook information turns up on a Google search, because all of it, along with similar details about the other 200 million Facebook users, exists on the social network’s roughly 40,000 servers. Together, this data comprises a mammoth amount of activity, almost a second Internet. By Facebook’s estimates, every month users share 4 billion pieces of information—news stories, status updates, birthday wishes, and so on. They also upload 850 million photos and 8 million videos. But anyone wanting to access that stuff must go through Facebook; the social network treats it all as proprietary data, largely shielding it from Google’s crawlers. Except for the mostly cursory information that users choose to make public, what happens on Facebook’s servers stays on Facebook’s servers. That represents a massive and fast-growing blind spot for Google, whose long-stated goal is to “organize the world’s information.”

In addition to having so much information tied up in Facebook, walled off from Google, the battle also is over how users identify themselves on the web:

Connect and Open Stream don’t just allow users to access their Facebook networks from anywhere online. They also help realize Facebook’s longtime vision of giving users a unique, Web-wide online profile. By linking Web activity to Facebook accounts, they begin to replace the largely anonymous “no one knows you’re a dog” version of online identity with one in which every action is tied to who users really are.

I’ve written before how important the identity issue is for MLSs.  Will MLSs step up to the plate and help their members establish an independent identity or will Google and Facebook become the standard for identity on the web for real estate professionals?

The introduction to the Wired article makes a better ending to this post, because it shows that these wars are just being waged now.  So much is yet to be decided, and that makes this an exciting time for everyone if we embrace the opportunity.

Today, the Google-Facebook rivalry isn’t just going strong, it has evolved into a full-blown battle over the future of the Internet—its structure, design, and utility. For the last decade or so, the Web has been defined by Google’s algorithms—rigorous and efficient equations that parse practically every byte of online activity to build a dispassionate atlas of the online world. Facebook CEO Mark Zuckerberg envisions a more personalized, humanized Web, where our network of friends, colleagues, peers, and family is our primary source of information, just as it is offline. In Zuckerberg’s vision, users will query this “social graph” to find a doctor, the best camera, or someone to hire—rather than tapping the cold mathematics of a Google search. It is a complete rethinking of how we navigate the online world, one that places Facebook right at the center. In other words, right where Google is now.

This last week we added a new function in flexmls Web to allow users to edit map shapes, name them and change their color. You can click to grab any point and move it to change the shape, and you can click in the center of the shape to drag it to a new position.

You also can name each shape and specify a color to distinguish it from others.

We’re next going to add the ability for users to share shapes with each other, which we think will produce some interesting collaborative opportunities to improve searching, statistics, and CMAs.

Do you think the ability to share shapes will be useful?

Who do you think owns the shape data once it is saved and shared?

I was pleased to find Carol Van Gorp’s blog the other day (Carol heads up the MLS in Columbia, MO, and is one of our customers), and it got me to thinking about whether other MLS executives are blogging.  Given that Carol is one of our customers, it was very interesting for me to read what’s going on in Columbia and it would be great to be able to easily keep up to date with other MLSs via blogs as well.  From Carol’s blog roll, I see Cindy Butts’ blog and Cindy has a few others, like Ben Martin, but I’m wondering if any MLS executives are blogging that I don’t know about.  If you know of any MLS executives blogging, please provide the links in the comments below.

Over on our RETS Support site, we’ve posted a page about some new features we’ll be releasing on February 11 to help our MLS customers implement a VOW policy as required by the NAR/DOJ litigation settlement.  The main change to flexmls Web is there will be new seller opt out options on the Export tab in listing maintenance.  We’ve also made the data captured from these new flags available in the RETS Manager through a new VOW template type that can be set up according to the specific VOW policies each MLS adopts.

Let us know if any of you have any questions regarding these new features.  Also, if you have questions about VOWs or the terms of the settlement, I encourage you to check out Brian Larson’s MLS Tesseract blog.

Coming out of Inman last week, there are several people talking about “natural language search” for real estate, presumably based on MRIS’s new consumer-facing web site with this search format.  The idea is simple: we all search Google, Yahoo! and other sites from a single text box, so why shouldn’t that same approach work for real estate?

Answer:  Because it doesn’t have to!  The reason Google and Yahoo! search the way they do is that they’re organizing unstructured data.  If the data is structured, providing the consumer search options in that structure is much easier for them.

Need proof?  Look at the way Google designed their real estate search, structuring elements like price, bedrooms, bathrooms, and area:

Of course, providing non-abbreviated search terms and searching remarks and other unstructured data is important, and MLSs could do a better job of that, but the idea that users want to type in things like 3-4 bedrooms, 3000-4000 square feet, etc., rather than using structured controls, seems to me to be making something that already is easy more complex.  What do you think is natural for real estate search?

Saul Klein of Point2 has posed a question at InternetCrusade as to what ” 5 things MLSs must do to remain relevant to the Real Estate Industry over the next 5 years?”  When I first started the FBS Blog, my first substantive post was similarly entitled “Death of the MLS?“  That question was perhaps more rhetorical than Saul’s, but the point was essentially the same — many people are questioning the relevance of MLSs in today’s web world.  One of my main purposes in starting the FBS Blog was to provide a counter to this drum beat, because the relevance of MLSs seems pretty clear to me.

To that end, let me quote at length from my seminal post Death of the MLS?:

Before delving into the three doom and gloom scenarios (bias showing through), some background on the MLS model and its value proposition may be helpful.  Whenever someone asks me what I do for a living and they aren’t familiar with the concept of an MLS, I tell them that it’s sort of like the stock exchange for real estate.  The MLS facilitates the definition, if not the creation, of a market for real estate.  Now, I know this analogy is far from perfect, but I think the idea of a market is critical to this discussion.  What is the market being served by the MLS?  Is it the market for real estate services?  Is it the market for real estate?  Is it the market for real estate advertising?  Some other market?  Does the MLS serve the purposes of competition in any of these markets?  How?

From my days in college studying economics, I recall there were some pre-requisites to “perfect competition” in a market:

Many buyers and sellers.

The products are basically the same (homogenous).

Perfect and complete information — buyers and sellers are on equal footing.

Low barriers to entry into the market, mobility of resources.

Predictability, usually established by some legal framework to uphold promises.

Of course, there isn’t a “perfect” market anywhere (some agricultural commodity markets come close, but that’s about it).  Rather, these conditions present a continuum towards perfection.  Looking back to pre-MLS, it’s pretty clear that the MLS helped foster many of these core requirements of competition in the real estate market itself.  The MLS brought more buyers and sellers together, provided more information about the products, lowered barriers to entry into the market, and provided predictability for real estate agents, buyers and sellers regarding how they could work together.  Much the same could be said for how the MLS impacted the market for real estate services.  Buyers, sellers and their agents knew much more about what each party was bringing to the table in the real estate transaction as a result of the MLS.  Moreover, the MLS “leveled the playing field” (eased entry) in the real estate services market, which is another reason many complain about the MLS today.  Many feel that competition is best experienced head to head, with as many barriers as possible.  By providing technology, education, lock boxes, and other services at a lower cost to the average agent, the MLS lowered a lot of barriers.

Interestingly enough, back in the present, those prognosticating or wishing for the death of the MLS feel that the quest for perfection is now being impeded by the MLS.  The MLS is alleged to have rules that get in the way of new entrants, who don’t want to play by those rules.  The MLS is claimed to be preventing the free flow of information.  The MLS supposedly is restricting the number of buyer and sellers.  If true, these actions would indeed be anti-competitive.  The question is whether the claims are true or not.  In what market is it true?  If the MLS didn’t exist, would these factors be fostered more or less?  Would a national or super-regional MLS improve the competitive environment?  Under what circumstances?

Much of the furor regarding the MLS lately is over the role the MLS should or should not play in the market for real estate advertising.  The lawsuit by the DOJ against the NAR mostly involves real estate advertising.  Many of those who complain about the rules and regulations of the MLS are those wanting better, cheaper, faster access to the MLS data so they can advertise it on the Internet.  Is the MLS fostering this market or making it less competitive?  Is the aggregation of the data possible on the same scale without the MLS?

Of course, this was written before the settlement of the NAR/DOJ litigation over VOWs. Also, during the last 18 months, there have been several large regionalization efforts, but the majority of the efforts are focused on data exchange or sharing among MLSs, not broad consolidation. So, the value proposition of the local MLS seems to me to remain strong, providing for more efficient data exchange, lock box systems, and more to create the local real estate market. I don’t see that changing any time soon, do you?

The controversy over NAR’s attempt to cover up their failure to trademark MLS with claims of ethical violations rages on over a case in Sarasota, Florida.  Inman News and the Bloodhound Blog report on it, and the issue has elicited huge commentary at Real Estate Webmasters.  I’ve long had the position that the NAR won’t be able to put this genie back in the bottle, and trying to do so will just anger their customers.  I also suggested a few times that the NAR would be better off spending their money creating a new brand to promote IDX authorized sites:

Once data standards are established, promising a strong and comprehensive data product from brokers and agents to consumers, NAR should create and heavily promote a branding and logo program for legitimate IDX sites so consumers can have confidence they are seeing everything.

With the recent VOW litigation settlement, this idea is one step nearer fruition.  Now NAR just needs to shift its focus away from annoying its members and instead use their funds to help their members with a strong brand that will enhance the authority of their individual web sites.  Imagine what NAR could do with their TV and other ad dollars targeted at promoting a simple brand certifying web sites that have all the data available for consumers?

Alternatively, perhaps a company like Roost or someone else (e.g., FBS with its flexmls or other brand?) will step up to the plate with such a brand.   NAR can lead or follow.

About a year ago, I wrote about my repeated failures at predicting agent declines over the last several years. This afternoon, I was reading a post on Read/Write Web called How Decoupled Is The Innovation Economy From The Rest Of The Economy and it got me to thinking about agent counts again. You might think those sorts of numbers are top of mind for me in running FBS, but the numbers tell why they aren’t. Since January, we’ve only seen a .32% decline in membership in existing accounts. Certainly, some of our 100+ MLSs have had some significant decline but, on average, it’s been completely flat. (We’ve also been fortunate to see lots of growth in new accounts.)

Some of this flatness could be from some MLSs using end of year billing but that isn’t likely to be the case for over 100 different MLSs, many of which are sure to have had billing cycles since January. Rather, my belief is there was a big enough decline in 2007 that left 2008 pretty stable. The big question is what 2009 holds in store. Your thoughts?

A week or so ago, we held our annual FBS Summit and hosted a panel of speakers on the pros and cons of MLSs creating and promoting consumer facing listing sites.  We recorded the sessions and now have the videos uploaded for public viewing.  We had to break the nearly two hours of video into many small parts and the easiest way to show them all is with the links below.  Over the next week or two, I’ll be writing some posts with additional commentary on some of the videos and embedding them at that time but if you want the full experience just click through the following links.

Victor Lund Part 1

Victor Lund Part 2

Brian Larson Part 1

Brian Larson Part 2

Alex Chang

Duane Sauke Part 1

Duane Sauke Part 2

Question 1 – Do MLS sites favor big brokers, small brokers, both or neither?

Question 2 – Is an MLS site in conflict with IDX?

Question 3 – If an MLS has a public facing site, what are the best ways to drive traffic to brokers? (Pass through versus destination.)

Question 4 – Are leads from a listing search good leads given dual agency? How do consumers choose an agent?

Question 5 – Is promoting an MLS brand in conflict with the brokers’ efforts to promote their own brands? Is advertising by the MLS in conflict with the advertising of the brokers?

Question 6 – Should an MLS spend member dollars on advertising a portal?

Question 7 – How would the branding efforts of a site like Roost compare to what an MLS could or should do?

Question 8 – Can an MLS promote the REALTOR brand and the MLS web site at the same time?

Question 9 How can MLSs help train agents to respond better to consumers? Is that the role of the MLS?