Realty Times January 21, 2000

The NAR Perspective: Legislation to Protect Online Databases Is Needed Now
by Dennis Cronk

In the real estate industry, the only constant is the desire for ownership. How property is bought and sold is forever changing, and nothing has changed the industry more radically than the Internet.

By cruising the Internet and taking virtual home tours, people who might not otherwise have considered buying a home are getting into the market. Twenty-three percent of potential home buyers search for a home online. And, home buyers who use the Internet are able to cut down on the number of homes they actually visit before signing a contract. In fact, they look at half as many homes as those who do not use the Internet.

Without a doubt, online technology is empowering consumers. However, it is also empowering information thieves. As more real estate information is made available through the Internet, so are more opportunities for pirates to steal the data and reuse it to the detriment of consumers and real estate practitioners. There is a clear need for new federal legislation to guard against the theft, reuse and distribution of online data.

A top legislative priority for the National Association of Realtors this year is enactment of H.R. 354, "The Collections of Information Antipiracy Act," which would prohibit the copying, repackaging and re-marketing of data collections, including real estate data, that is compiled, packaged, and presented in a certain manner by individuals in the course of their business. The bill was reported out of the House Judiciary Committee last year and is now pending consideration by the full House. Enactment of this legislation is critical to gain tighter protection of the selection and arrangement of data in online Multiple Listing Service (MLS) compilations.

In the real estate profession, the selection and arrangement of online MLS data is information that must be protected as intellectual property. Piracy of data is a very real threat that places credibility of information at risk. Here is the problem: Suppose a data pirate copies 100 listings from a valid real estate site and posts them to another site. This information thief is under no obligation to keep the information accurate or to remove listings once properties are sold. As a result, consumers visiting the thief's site may be wasting their time perusing listings that are out-of-date.

Data pirates could also engage in other shady practices, such as selling addresses to moving companies or demanding payment from brokers for buyer referrals. A pirating entity has no contractual or legal obligation to the real estate professional or consumer. There is no guaranteed protection of identity or addresses. It is the right of the real estate practitioner and the homeowner -- and no one else -- to decide where the homeowner's listing should appear. No one should have the ability to simply press a button, copy listings to another site, and use those listings as their own.

Online data piracy could ultimately deter the continued development of useful real estate web sites, including our own Realtor.com, which leads the pack with more than 1.3 million property listings. If it is not stopped, content providers and Web site developers could lose the incentive to create and maintain sites with accurate, up-to-date information. Why spend time and money to maintain current sites if pirates can easily steal the information and reuse it?

As more information becomes available online, the problem will get worse unless tighter protection is put in place. As yet, we have relied on federal copyright law, state contract law and underlying licensing agreements to protect our enormous investment in real estate listings. However, we feel gaps in this protection can best be filled by a new federal statute that will complement existing copyright protection laws.

With the Internet offering consumers more real estate information than ever before, we have a responsibility to make sure that information is accurate and up-to-date. Last year, our members placed more than 5,000 calls to Congress urging support for database protection legislation. We prepared to use our extraordinary grassroots network this year to keep the momentum going for this bill, and we're confident Congress will listen to us.


"The NAR Perspective"

Dennis Cronk, a REALTOR® from Roanoke, Virginia, is the 2000 president for the NATIONAL ASSOCIATION OF REALTORS®. NAR, The Voice for Real Estate®, is America's largest trade association, representing more than 750,000 members involved in all aspects of the real estate industry. EMail you questions or comments to Mr. Cronk at: dennis@denniscronk.com



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