Realtor.com has joined a long list of its competitors which no longer pay MLSs for listings. While some royalty contracts extend into 2005, Realtor.com is asking those MLSs with whom contracts are expiring to continue to provide the listing feeds at no charge.

One presentation has already gone well for the company.

A Realtor.com representative spoke to the board at the Greater Tampa Association of Realtors on Monday, September 15th. Tampa is a key contributor for Realtor.com -- one of the few remaining Gold Alliance partners with an agent membership of over 5,000 agents. He told the association directors that due to previous mismanagement, Realtor.com can no longer afford to pay MLSs for listings, but that Realtor.com is a valuable ally to promote the Realtor brand and to give brokers and agents a place to advertise their listings that doesn't charge referral fees for leads.

Board member Tom Scaglione says that he agreed and encouraged the board to vote to continue supplying Realtor.com with its listing feed, but with a caveat...

"Everybody's trying to aggregate our listings," says Scaglione. "I knew this was going to happen five years ago when I met the people who were leading Realtor.com. I knew they were as crooked as the day is long, and it is amazing that it took this long to fall apart. (Editor's note: Scaglione refers to previous Homestore management. New leadership took over in March 2002.)

"I firmly believe that MLS data is very valuable and that no way should any company be allowed to make a profit from it without sharing that profit or pay the MLS up-front for this valuable intellectual property," he says. "As a director, I have to put personal feelings aside, and I have to make decisions that are good for 5000 members. I made the motion to continue the feed to Realtor.com. "

Tampa's Gold Alliance agreement expires September 28th. Scaglione says he was instrumental in negotiating a six-month extension for the Realtor.com feed beyond the expiration date. Why six months? He wants a profit-sharing agreement.

"I brought up the question of why there isn't any profit-sharing offered to the MLSs, but the Realtor.com representative couldn't answer my question," says Scaglione. "He explained that the company is working on revenue-sharing deals which they are testing in certain markets. I asked him if 'things turn around, would you consider revenue-sharing and renegotiate?' My expectation is that if NAR doesn't see that they are going to turn things around, they will hire a new company to manage Realtor.com or NAR will say 'See ya.' The rep intimated that if they don't get this job done, then they are going to be out in the cold."

Scaglione feels that much of Realtor.com's woes are due to poor communication on the part of the company.

"I look at the fact that people use Realtor.com in their listing presentation, but only 12 percent nationally enhance their listings," says Scaglione. "We asked what the numbers were for our association, and it is also 12 percent, Realtor.com doesn't do a good job of getting across what the true cost of enhancing the listing is. They have four different programs to enhance listings, and they don't do a good enough job of making that clear."

The Naples Association quit their Realtor.com feed, points out Scaglione, "so now all the brokers have to work their own deal, and I don't think that's good for members. We figured they could come back to us in six months and let us know how they are doing, but we want to hold their feet to fire to make them a little bit more responsive."

To the question of how the MLS is being compensated for providing the feed, Scaglione responds, "They are pulling the data instead of us pushing it, so the expense is on their side. The consumer won't know the difference. We had the one-time expense of setting it up so they could use the data, and we have the datalink which exports to an file transfer protocol (FTP) site. It's no different than the feed we give to the Florida Association of Realtors for Internet Data Display (IDX.)" (The Florida Association of Realtors provides Web sites and IDX solutions to members at no charge.)

Find out in tomorrow's edition of Agent News what Realtor.com's new value proposition will be to MLSs and Realtors.