HomeSeekers new value proposition was laid out in an Internet presentation to MLSs and the brokers and agents complete with voiceovers from new CEO Thomas Chaffee, new president Steve Crane, and senior vice president Greg Robertson who created an online slide presentation outlining the benefits of HomeSeekers to MLSs and agents.

The upshot is that HomeSeekers' MLS partners which are owed unpaid listings royalties (about 95 MLSs) were asked to forgive the debts and to consider HomeSeekers value as a member service - as an advertising/lead generation portal for brokers and agents.

Making no money forthcoming sound good when MLSs are not only owed thousands individually, but are still being paid by other portals such as HomeAdvisor and Homestore is not an easy feat. Understandably, responses to HomeSeekers' new value proposition have been mixed, with the MLS executives swinging the pendulum from forgiveness to banishment. MLS executives are now considering what forgiveness really means - the possible end of a business model, and a reevaluation of what member benefits are and should be.

Here are responses from three leading MLS executives:

Russ Bergeron, general manager of Southern California MLS (SoCal)

"The reason they are still having money problems is because all the money went to HomeMark," says Bergeron. "My take is that there will be no bankruptcy. If they declared chapter 7 or chapter 11, the whole FNIS deal would fall apart. FNIS's deal is to give them cash and a line of credit so that's all they have. "

"They explained that they were hoping to make partial payments, but that deal was never consummated. They don't have the deep pockets of a HomeAdvisor. I think it is a possibility that most MLSs will pull their listings - with IDX looming on the horizon, they may limit it to the portals who are paying."

"We receive about 1/15th of our revenues from various licensing sources. Obviously we wouldn't want to lose that revenue, but we could live without it.

"The national portals have never been that good to the average agent or broker. They are not designed to drive traffic to them, but to the portals themselves. The agents and brokers need to market their Internet presence whether on a portal or on a stand alone site.

"The portals were handy in getting our data to the public. With IDX that need goes away and the offices with the market savvy will dominate.

"We'll probably try to restructure our deal with HomeSeekers so that we can continue to support the hundreds of customers who use them for their web site business.

John Stih, CEO of Southeast Valley Regional Association of Realtors (SEVRAR)

"There a lot that are owed money, they owe $20,000 to me alone, and that's a lot of credibility to restore," says Stih. "I'm surprised they have an entity after selling their biggest cash cow, (XMLSWeb). I don't know what's left, and I figured they weren't going to survive. What do they have to sell other than the Lightning program. I threw that out of our store because they haven't paid me. It's owed and uncollectible. We are a not-for-profit, so a tax write-off doesn't help us that much.

"If they do turn it around and want to come back to us, they will never get back in the door, not from what they've done. We've had two or three payment workouts in the past, and I had to go before about 5,000 people in the valley and tell them. Our MLS is owned by about four boards and each one is entitled to a free download of their choice. We gave it to HomeSeekers and we had several arrangements with them. They were cut off once before for nonpayment, so when we decided to sever the relationship, I notified all the people who had Web sites with HomeSeekers and told them that we haven't been paid. I had to sit there and answer questions, so next time we do something like this, give MLS information, we're going to be very selective. The way the market is today - it's good today and bad tomorrow, and we get calls everyday from new companies. We're just not willing to take the chances anymore.

"Broker Reciprocity will change the ball game, too, and who's to say how it will get to a third party. It will be interesting when it takes off."

Ken Duke, CEO of Regional MLS (RMLS, West Palm Beach)

"I guess if I have to say anything it would be that as long as they keep their Internet service up and running, we will let that happen, even though they aren't paying us, and while we are being paid by other vendors for our data. We have a long-standing relationship with HomeSeekers. We had their pre-Internet product, and we have rolled with the times. I lost a lot of money on their stock.

"We have about 500 people who got free home pages from them, so we are trying to look at it from their point of view. We are here to serve our members, I don't know that we will continue long term with that arrangement, but I need to get a survey of how many have the Genstar product (Web sites hosted by HomeSeekers) and home page purchases, and if it is something that has fallen off, we can take a different approach.

"Homestore is moving from $1 to $.50 a listing, that's the handwriting on the wall. What's going to happen is national aggregators will fall by the wayside, and IDX will take their place, because IDX will let them (brokers) reach the majority of their market anyway. It would be nice to have a national site for that referral business, but life isn't free, and we spend a lot of man-hours to keep the listings up for companies like Homestore and HomeSeekers."

Published: December 24, 2001

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