Agent-focused RE/MAX International has been publicly quiet on the (virtual office Website) VOW issue, but very vocal in its own network, according to RE/MAX CEO Daryl Jesperson, who also held a seat on the NAR extended workgroup which analyzed and wrote the proposed policy on VOWs.

"We haven't been quiet at all," says Jesperson. "This is an industry issue, not a publicity opportunity. We have been very active within our network. I was part of the expanded workgroup, and on Friday last week, our general counsel participated in a meeting in Chicago with a slew of attorneys looking at the issue alongside NAR. At our convention at Las Vegas recently, I did about a half-dozen formal presentations on the topic to regional owners, directors, franchise development consultants, top 100 brokers, and others. Ann Bailey had a general session at our convention on the VOW issue - we've been talking about it within our own group."

Does RE/MAX have a public position on VOWs?

"The foundation is that the listing is the asset of the broker or sales associate and they should have right to deploy that asset as they see fit," replies Jesperson, "and it is NAR's duty to protect the assets of the members. NAR is doing the right thing in the issue, and I know how much effort went into the proposed policy. It took a lot of e-mails and discussions to get it where it is today. We look at VOWs as a good thing if properly implemented as a tool for the agent and broker to work with online clients. Some issues of concern were addressed in the policy, that agents have the right to have VOWs and that is in the policy. That wasn't there when the expanded workgroup first met. The way it is written, there can be no advertising with someone else's listing. If I have your listing on my site, I can't frame it with my mortgage or title company."

Criticism of the proposed policy is coming to the surface that it is complicated and in some cases, vague in its implications and implementations.

"You have to think your way through each sentence," concedes Jesperson. "I think most brokers have to look at it from two perspectives, because this is an issue that can cut both ways. Something you might be tickled with on someone else's listing you wouldn't want them to do with your listing. When practitioners read this policy, they need to really think of how it impacts them, but also how it would impact a competitor."

What about issues that weren't addressed in the proposed policy, such as Cendant's white paper request that brokers be allowed to opt-in, opt-out in allowing their listings to be published in competitor's VOWs?

"I feel that at the minimum, there should be a selective broker opt-out provision available," declares Jesperson. "The reason for that is, in a high percentage of cases, VOWs will help the consumer and broker, but if you are uncomfortable, you will get the benefit of good VOWs and the VOWs that are misusing your information, you just don't provide them your listings."

What constitutes misuse of listing information?

"There is a fuzzing of the issue," explains Jesperson. "The virtual office is not an exact duplicate of bricks and mortar. If I am a bricks-and-mortar broker and a buyer pulls up in front of my office in a beat-up car and steps out with a disheveled appearance, and I get the feeling this is not someone you want your 16- year-old to go out with, I'm going to be reluctant before I show them my $2 million listing. I know we aren't supposed to judge from outward appearances, but we can sit them down and learn more about them. You are going to go to that extra effort because that is what your seller expects you to do. Online we don't know who is on the other end. It brings out people who aren't the finest folks. If I am seller, I expect the broker to supply information about my listings to qualified buyers, not lookie-loos, burglars or perverts. Let's get more specific. Let's say you have a $2 million listing and a awesome media theater, but because they are buying another property, this home is vacant. If you put that it is vacant, and if I am a burglar, wouldn't I like to know that this property is vacant and has all this movie and sound system gear? There is a substantial difference, because of responsibilities to the seller, we have to protect that information."

What about accusations from opponents that a selective opt-out provision would be an anti-trust violation?

"The MLS committee will discuss that, and it is certainly top of mind, but when they think it through, the selective opt-out makes the most sense. Our legal team feels it is defensible. One of the favorite chants of opponents is anti-trust. I don't know many Realtors that are Harvard Law School card-carrying attorneys. If you talk to some of the best legal minds, it is a whole different thing. Again, under the foundation, the listing is the broker's asset, and he has the right to use it as he sees fit. If he is in a cooperative environment, he should have the right to jerk it if someone is misusing it. You would get the benefits that VOWs provide and most would use the information correctly. It would be the renegade that abuses that privilege. You should have the right to take the keys away. It is no different than lending your car to your teenage son.

"It all gets back to the listing agreement as an asset of the broker, and that asset should be developed as the broker sees fit," continues Jesperson. "Outsiders to our industry think listings just happen. You get the listing because of money you have invested over the years, your office, the salaries you pay your employees to keep the lights on, you invest to get that listing. You have responsibility to protect it, and it is your asset.

"With broker opt-out, the first person to realize that the information is being abused is the broker. I use broker/agent interchangeably because they will all have VOWs, so they are the first to realize improper use.

The VOW controversy is similar to the US build-up toward war in Iraq. City governments are complaining they don't have the money to institute the protections the federal government. Citizens are asking who is going to pay for this war? MLSs also suffer from too little money to help members implement VOWs and help them to police the sites.

"One thing I learned from the workgroup is that there are 900 MLSs, and 600 have a staff of two or fewer people," says Jesperson. "They are understaffed, underfunded, it is a political issue. They are a service agency. Instead of putting MLS in the control position, it should be the broker who is in control.

"The ideal solution would be to have security at the MLS instead of the VOW operator level, but so many are so small, they don't have resources to provide the VOW environment with persistent downloads and intermittent downloads. One of them would be where all server mechanisms were at the MLS, and they could detect things like scraping. Let's say if you were a moving company, wouldn't you like to know about all the fresh new listings? Most MLSs are not financially prepared to take on that challenge, and over and above the anti-trust issue, if you are the MLS vendor the software would be a nightmare. Imagine the selective opt-out. Send my listings here but not there. It will be a real challenge.

So you feel the broker should be in control of security on the listing?

"The MLS doesn't own the listing, the broker does," says Jesperson. "He who controls the data, owns it. With mandatory opt-in, the MLS owns the data. With opt-out, it acknowledges who the true owner of the listing is - the broker."

If the issue isn't voted upon to your satisfaction, would you create a RE/MAX MLS, as Cendant has vowed to do?

"We don't speculate on that, but the reality is there already is a RE/MAX MLS - REMAX.com," says Jesperson. "Over 98 percent of RE/MAX listings are on our Web site, and we only have RE/MAX listings."

Is REMAX.com still operated by Realtor.com for you?

"Yes, and I see this whole thing as very favorable for Realtor.com," says Jesperson. "NAR did a good job in putting requirements with Realtor.com that prevents them from doing some of the things that other people are doing right now. Specifically they can't refer, and it is the way the relationship is to advertisers that matters. What would have kept the newspapers from taking my ad and saying oops we didn't put your phone number but we have these people who inquired about your listing, and would you pay us a referral fee? This is no different. It is a different medium, and I don't know of any newspapers that would get away with what some companies are doing online and that is because offline we have selective broker opt-out. You can put your listings wherever you want, and if you don't like what one newspaper is doing, you can go to the newspaper across the street."

Is REMAX going to continue to educate brokers and agents on VOW issues?

"We have to admit we're only scratching the surface," says Jesperson. "One of the benefits of this issue coming to a head is more brokers will do more investigation. Most brokers are still adapting to IDX, so the VOW issue is in the background. NAR has to have a policy so we can start regulating - the longer it goes unaddressed, the harder it will be to make changes.

"It gets back to who the asset belongs to - if you give them the keys to your car, and they've wrecked your car, it's your fault, too. A well thought-out VOW policy will solve those problems. Just having a broker's license doesn't mean you deserve to receive a portion of the broker's commission, and the consumer already has access to listings so how many sources do they need to have? We need to facilitate VOWs for the agent. When online listings first became available, and listing agents had a number of listings, the consumer said that isn't all the stuff in the neighborhood. They want to see all the listings. The consumer needs to be educated to go to certain addresses. There is a reason on every REMAX commercial, we end with REMAX.com."

Published: March 20, 2003

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