Low cost Internet MLS solutions to system conversions are available for the asking. Yet many MLSs are afraid to consider the Internet. So what does the Internet really have to offer?

MLSs want to maintain proprietary control of data. Their members want quick easy access to the data. Can the Internet provide a solution where everybody wins?

Some Internet MLS service providers have figured out how the MLSs can have their cake and eat it, too. With low cost, a quick set-up and easy-to-use point and click learning curve applications, the Internet can overlay a common language and easy search features over the most stubborn legacy hardware/software. Blazing the trail into the future are Internet MLS solution providers such as MLS2000 and Infinite Access, makers of Realty Expo, and one lone scout - MRIS, the nation's largest MLS organization.

John Giamo, president of HomeSeekers (MLS 2000), explains that his company has been a contract programmer for listings companies for some time, as evidenced by the company's recent strategic partnership announcement with Microsoft's HomeAdvisor.

"It's clear that the vendors in the industry haven't come up with a solution," says Giamo, "but we have."

He says, "Every MLS is different, even if the software and hardware are by the same vendor. We (HomeSeekers) have to log into all these systems to pull data and it is just incredible. In the Northeast, if you want to search on type of heat, you have to have fields for oil, gas, and coal. These have an impact. So we found we were doing the customization of fields for all the MLSs."

The next step was logical. Create an Internet-based search solution for MLSs and offer it for sale. HomeSeekers rolled out MLS2000, a service that takes the programming function and its attendant costs from the MLSs by providing an Internet overlay to existing legacy systems.

The company can take all the various fields of information across the nation and aggregate them into one logical database, using one common language for searches.

If a Realtor wants to search on an obscure field such as pink fireplaces, s/he can do it - from coast to coast, without an additional $25,000 system modification charge to his/her MLS.

"What we have done with MLS2000, we have thrown our hat into the ring. Our first system is in testing and will go into full production by March with the Southern California MLS as our first client. They will now have a method if they want to search on "pink fireplaces," and that field will be available to all members."

"An administrator from the MLS still has to determine whether pink fireplaces is a legitimate field. The administrator is in charge, but when s/he okays it, we have the flexibility to add it the same day."

"This means the MLSs only have to provide an administrative function not a programming function," explains Giamo.

The underlying technology that makes this all possible is based on XML. "Open architecture creates a standard that works for these systems, and it brings prices down. Instead of $8 to $18 monthly fees, we will charge members as little as $2 to $3," says Giamo.

Fighting the FUD factor

With an Internet MLS, associations and their members can save time and money - and retain control of listing content. Just as with Realtor.com's One Realtor Place, certain information can be password protected. There is no software to install, an agent can use the system within five minutes, no training is needed because it works off of a browser with point and click technology.

So what is stopping MLSs from utilizing this simple, easy to use and inexpensive technology? The FUD factor.

Bill Mitchell, president of Infinite Access explains. "Many MLSs aren't comfortable assessing technology. They want to keep it proprietary. They think when they hear the word Internet that they will lose control of the data flow. They are paralyzed with the FUD factor - Fear, Uncertainty and Doubt.

"We are a software business. Our largest customers are real estate companies," says Mitchell who does the listing management systems for Coldwell Banker and ERA. "They are all worried that nobody can build these things, and we have already built them. With an open system like ours, the broker controls the data flow. Basically, ERA and Coldwell have built a Web-based front end that communicates with a legacy back end."

Mitchell offers other advantages to the Internet solution. A primary advantage is the low cost to the brokers for data handling and error checking.

"That is why Cendant licensed us," he explains. "If someone loads a property, we can avoid problems like incorrect data fields and photos not loading because of the built-in error checking."

"Another feature is you can do a preview of what the listing looks like. Agents can catch their own errors at that point."

"Another problem that would be solved is data validation of properties. If you have a property in Brentwood, it really is in Los Angeles. With our system, you can obtain the legal address, and get all the properties," says Mitchell.

MLSs have always viewed the Internet as a threat rather than an opportunity. They are slow to the party to roll out open standards. But everybody wins - brokers, associations, and buyers and sellers: there is free flow of information. The MLSs can still control it and distribute it to anyone they want. The politics just get in the way. What could be better for the agent than any where - any time - any PC - access. It can all be password protected, giving the agents the same controls they have today."

Giamo knows that overcoming the FUD factor won't be easy.

"We have thousands of consumers using HomeSeekers every day - without a handbook," says Giamo, "Yet, the MLSs fail to see how their own members could adjust to using the Internet."

"That situation in Dallas could have been avoided. Members are reluctant to get involved with technology. They have to be pushed. The system vendors and the MLS know this, so we don't make them go cold turkey, MLS2000 will run parallel with the legacy system. The same information and data will be available - how it is retrieved is the difference. As an agent, I can warm up and learn it at my speed, without going through culture shock."

"Is there a clear advantage in being able to say to a client, "Okay, I've got all my notes. I'll go back to the office and see what I can find for you." But how much better to be able to say, "I've got my computer, or can we use yours? Let's log on and see what we find for you," describes Giamo in a typical buyer presentation. "It is better because they are not tied to the office system."

"We are trying to get agents to carry laptops. At some point everyone will be connected to the MLS, even through the TV."

One MLS boldly alters its business model

One man who can see the code on the wall is Dale Ross, CEO of MRIS, the largest MLS organization in the country with over 26,000 members. He and Gregg Petch, chief information officer are overseeing the conversion of GTE System 3.5 to System 4. With an interesting caveat. Instead of turning the lucrative revenue generated by an assortment of Internet Service Providers(ISP's) over to AOL and MSN among others, MRIS is acting as its own ISP, providing connectivity to its members. The company is adding hundreds of phone lines to accommodate access. Currently, MRIS offers connectivity to 2,500 concurrent users. More lines are coming with the roll out of System 4.

"Anytime there is a conversion, there is an uprising," says Ross. "What we did differently is we only paid attention to the top producers. We never went to the lowest common denominators. The lowest can't participate anyway and they soon drop out of the business."

"There's not a lot of difference between Internet and legacy systems," says Ross. "The system is the same technology. But we take a different model. We are Internet-based with our protocols. The issues with the Internet are bandwidth and connectivity."

"The real estate application is "mission critical" to the Realtor. In other words, I need information and a guaranteed connection," says Ross. "So, we have built a private Internet network. Since we control it, we guarantee that every time you dial up, you can get through."

Ross discarded using third party ISP as part of his Internet solutions. "If you use an ISP the dial up is sometimes 50 to one that you'll get through. Then you might get on and the traffic makes it slow. That won't happen with our system."

The way GTE and MRIS have built the Internet application, the company is able to guarantee bandwidth and connectivity with no dropped calls.

Where others are running into problems is that the software, the communications technology and the server/hardware pieces must be in sync.

" If those three pieces aren't large enough for the application, it won't work," says Petch. "Connectivity is the key to this thing. If we can build a large network with the right front end and the right servers, it will work the way it should. We have over 2,000 dial ups for over 22,000 square miles. If we add new customers, we can add new nodes to the server farm."

"We built this system with expansion in mind. The Internet plays an important role - with a single dial up we can offer MLS data, public records, Internet access and e-mail."

Ross has been approached by other MLS organizations to assist them with an Internet MLS solution. "We have had other organizations come to us and they are investigating how to do it, too."

Ross anticipates that training will be his organization's biggest problem with the roll out of an Internet MLS.

"We always took the approach that the communications piece is the critical component. and so training people to use PCs has been important," explains Petch.

"We are dealing with an industry that is 10 years behind in technology. Let's move from 10 years behind to leading edge. That's why we spend a lot of money in training. We are the technology partner for our brokers. We can assist them and save them money in the process."

MRIS is currently buying phone circuits from the local phone companies.

"There won't be anything our brokers can't do - office to office, office to Internet office to MLS," smiles Ross.

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Published: February 26, 1999

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