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

Michael, perhaps try http://www.archive.org/web/web.php and enter the URLs of popular sites back then and you may dig something up.

Interesting post, Michael.

I think what I’d like to see is these alternative models expressed in numbers; thing about ‘business models’ is that few of them don’t work in words, and few of them work in numbers.

Because whether free or not, there is a cost to things like compliance and tech support. Somebody has to pay for things that brokers and agents want in a “MLS”. I’d like to see the models expressed in at least a pro forma form to evaluate them.

-rsh

PS: BTW, I’m not the Director of Marketing for MRIS. Since MRIS is actually trying to recruit a Director of Marketing, we wouldn’t want them getting the wrong idea. Mind correcting the post?

Michael- I will send you my original FREE MLS presentation as soon as I dig it up. It was presented in the context of “everything drops to FREE” on the Internet. Granted advertising is only one vehicle to replace the revenues needed to operate an MLS.

The conceptual idea however remains- if the MLS monetizes the listing data, the revenues generated could pay for their MLS system. At the time of the original presentation, the “new” Internet took out the vast costs of proprietary delivery (remember modems?). Thus, things on the Internet would drop to “free”. While it didn’t quite work out that way- it did reduce MLS costs and enabled new generations of systems like XMLSWEB to service large MLSs at significantly reduced prices.

I agree with Rob- the numbers must be pushed around-and probably vary in each case. But the advantage of MLS agent facing advertising is higher CPM revenues and ultimately the real money is in exposing the pre and post movers. .

You have pretty clear recall, Mike. I’m going to see if I can find my original PPT from the “Free MLS” session in my archives and if I can find it, I will share it. The original concept presented was similar to what people call the “Freemium” model today, where the price for basic MLS service could fall towards free and be subsidized by advertising and/or sale of the data to third parties. Premium content, tools, and services could be optional and ala carte by subscriber. This was also during a time where the Internet was eliminating modems and private data networks that comprised a large chunk of MLS costs.

Today, perhaps more than in the past, there are many advertisers that would like to reach REALTORS and are willing to pay a substantial premium per CPM or CPT for the targeted professional audience – especially on the MLS system where agents “have” to go frequently. Some of the special offers could be valuable and welcomed by the subscribers. I’m not sure people are ready for it, but we could see more MLS operators running innocous, low friction type ads in the near future, which could be used to subsidize MLS operations and lower end-user fees. It could happen in our lifetime!

I definitely think that the RPR as presented so far opens the door a little wider for advertisers to get a foot into MLS. If NAR can attempt to generate revenue from MLS data and NOT share that revenue, why wouldn’t the MLS’s try to generate revenue on their own, from sources previously considered taboo? We already have products from 3rd parties that incorporate ads into the MLS Participant’s view, it’s only a matter of time before MLS’s, whether by choice or necessity, decide to ‘eliminate the middle man.’ The major hurdle I see for an ad driven MLS is control. As the MLS’s dependence on ad revenue increases, the decisions made regarding operations become more governed by the advertisers than the Participants.
Some MLS’s are already testing these waters with varying degrees of success, and more are sure to follow, but if history is an indicator, wholesale adaptation is a few years out.

So what’s behind the “free” ? Are any of these vendors of service making money? How long will free last? Some of the vendors are making money off of the members. Our members provide the data. So far only nominal revenue is going back to the MLS. Something tells me the MLS vendors don’t yet see how the revenue will replace what they are charging for the application and support. In addition many RPR like applications are being proposed to MLS’s every day. We’ve had two presentations already this year. Who is to say which vendor will corner the market. I’m fine with every vendor paying me for data, but our members don’t quite agree with the idea that they like advertisements in return for a few pennies off the MLS fees. Likewise getting limited raw data in return for valuable real time data is not attractive either. I think these vendors better get the idea ahead of time that valuable data costs money and the owners of the data will not give it up for advertising or limited raw data. The old adage that “real estate is local” still exists and local data sharing arrangements are much more effective than a national database of questionable quality and a lot of advertising.