As online listing policies designed to protect listing broker copyright rights are under fire from the Department of Justice, non-listing brokers are also leveling criticism.
Writes one broker:
"If a non-listing broker is able, even encouraged, to provide their clients/walk ins with property information in their office by granting full access to all property information contained in the office mls (sic) computer, printing records from the mls computer, making copies, sending a fax, generating automatic emails directly from the mls program or sending good old fashioned snail-mails; all in keeping with the goal to provide clients with current property information; how is it in the best interests of listing brokers to prevent the same non-listing broker from displaying the very same information on the non-listing brokers website?"
The broker continues, "Really, it boils down to listing brokers wanting non-listing brokers to deliver property information to their clients via every possible medium EXCEPT online display of property information on the non-listing brokers website. I suppose the non-listing brokers website delivery of real-time property information is just too efficient and effective (or profit-threatening) for listing brokers.
"Secondly, it is clearly a restriction of competition for listing brokers (and NAR) to say that a competitor (non-listing broker) CAN deliver property information to their clients via methods X, Y, and Z, but CANNOT deliver it via methods A, B, or C; especially when methods A, B, and C are efficient delivery methods. The entire body of work is copyrighted, so if delivery cannot be by new methods A, B or C, then it can't be by old methods X, Y, or Z either.
"Rather than clouding the issue with copyright and/or "public utility" issues (raised by an MLS solution provider), why not follow the money? That's the real answer/issue at the root of the ILD problem.
"I've repeatedly asked NAR to provide me with concrete evidence and/or cases that these databases were indeed scraped and/or used to harm the listing broker. The best I get from NAR is that the "evidence" is anecdotal and there are no illustrative cases for me to learn of or from."
-- Steve
Realty Times responds:
Steve, if all brokers wanted to simply provide clients with "current property information," there wouldn't be a problem sharing listings online, but unfortunately, the file-sharing capacity of the Internet poses a challenge to the listing broker and the use of the listing that the MLS book and the FAX machine never did.
First of all, when you print off a listing for a customer sitting in your office, you're printing the appropriate listing for your client, not providing him/her access to the entire MLS. Realty Times has outlined numerous problems for years that listing brokers are having maintaining the integrity of the data. Remember The Real Estate Book scandal of 2003? A Primedia subsidiary took listings from The Real Estate Book and "sold" the listings to LendingTree, MSN and others - without letting The Real Estate Book in on it.
It was such a scandal that The Real Estate Book was ready to sue most of the service providers involved, but was able to work out terms. Bottom line? A lot of kissing and making up went on, MSN never published the listings, and LendingTree cleaned Primedia's clock -- buying Realestate.com for a song. That makes it very clear that LendingTree was also a wounded party in the scam and most likely didn't know the use of the listings were unauthorized. Ok, let's be frank - the listings were flat stolen.
Now some may say the listings got additional exposure -- where's the harm? There was lots of harm done. The listings originated with the listing agents. They were paying The Real Estate Book for advertising exposure. It was never made clear whether Primedia or LendingTree removed the listing agent's contact information, but the fact is the listings did appear online without the listing agents' information. LendingTree wanted to collect referral fees by referring customers who made inquiries about the listings to their network of agents, not to the listing agent.
That's not what the listing agents were paying for. Why would they pay to advertise and then watch the leads go to someone else?
Now let's make it even more clear. Listing agents get half the commission for the listing, and while some say that's all they deserve, it's their listing. They have every right to use the listing to bring in business, including buyers, future sellers, and renters to their office. After all - the seller is hiring the listing agent to sell the house, not just to market the house, and that includes any efforts the listing agent can make to personally get the home sold. From that point of view, the listing itself is an advertisement for the agent, the broker and the broker's affiliation with a franchise. The Internet is the advertising medium -- not the customer.
It gets worse. Realty Times exposed the scandal because of a hot tip. A listing agent was phoned by LendingTree and asked if they wanted to pay a referral fee for a customer. The agent wanted to know where the customer came from. When the agent recognized their Real Estate Book ad, saw their name was nowhere on the listing, and realized it was being scraped for use by LendingTree to collect referral fees, the agent was furious, and rightly so.
This is the case that actually brought listing-sharing problems into focus. To assume that there are only anecdotal examples of this behavior simply isn't true.
Now LendingTree knows better and gets listings the way everyone else does -- by adding IDX and ILD feeds that they get with permission from the feed suppliers and by joining MLSs as a broker.
Theft of listings and referral fees aside, there are a few other reasons listing brokers should have the right to control where their listing ad is seen.
For one thing, when you give a copy of a listing agent's listing to a customer, you already have that customer. The listing isn't helping you get the customer into your office.
On the Internet, agents, brokers, and third-parties can use listings to get business, not just to serve existing clients.
To make it as plain to understand as possible, the listing agent doesn't owe any non-listing agent a tool to help them build their business beyond what he/she's already agreed to do -- share listing information for cooperation.
What we're really talking about here is entitlement. You somewhat contemptuously say, "Why not follow the money?" Well, what else are listing agents in business for?
Think about the music industry. When Napster came along, it supported free music-sharing among listeners. The problem was -- it cut out any chance for the artists, producers, record labels and all the other technicians and talents that put together the creation of the music to make any money from their efforts. Lawsuits ensued, Napster changed its business model, and new ways for people to listen to music of their choice (iPod) were invented.
Why should U2 produce music for nothing? Why should a listing broker produce listings for others without the opportunity to profit the way his/her business model is set up to do?
Last, in many instances, non-listing brokers use listing brokers' listings to attract consumers using different rules of engagement than they would in the MLS. The MLS, REALTOR Code of Ethics and other canons spell out rules of behavior to promote non-contentious cooperation. In the MLS, you can't criticize another's business model or offer one company less compensation than you do another.
That's a miracle in business. Imagine -- competitors working together for the consumer's good. But some brokers want to criticize the business models of their fellow brokers, using their websites to denigrate full-service commissions, for example. They want to use the listing brokers' listings, but they also want consumers to bypass the listing broker and use their services. They want their cake and to eat it, too.
That's impossible. You can't tear down the competition and still play by the REALTOR rules, or can you? Consider this ad using access to the MLS as part of the overall website's front-page advertising strategy. The message is clear -- if this company offers full service for less, and can offer full access to the MLS, then it tells the consumer that it can offer all that at a discount. The implication is clear that first there is some kind of set fee for full service -- which REALTORS vehemently deny, and the second implication is that other companies are charging too much (including the nice listing brokers who have so kindly provided the discount broker access to their MLS cooperaton-based listing.)
After pulling the consumer in with the offer of savings, there's a disclaimer.
- "Full Service with $avings!"®
- *Fees Vary for homes over $200k. Call for details.
- Commissions are not set by law. All commissions are negotiable.
- Any comparisons to a percentage commission, such as 6%, are for illustration and comparison purposes only.
Can you see why listing brokers might be upset by this company using their listings?
Let's go further. NAR's Code of Ethics (Article 15) states "REALTORS® shall not knowingly or recklessly make false or misleading statements about competitors, their businesses, or their business practices. (Amended 1/92)" Why does this rule go out the window when it comes to websites? Websites are advertising mediums, that's why, and anything seems to go on the Internet.
This broker goes so far as to lay it on the line. "So why buy a house through another broker?" the site asks. Once again, MLS access is offered on the front page of the site.
In the last example, a third party suggests to consumers how to save on commissions. HomeGain's Commission Savings Estimator shows what others using the site have saved. But if all commissions are negotiable ... why are these numbers any more real? HomeGain makes money by providing leads to real estate agents. Once again, MLS access is front and center.
Maybe some listing agents don't like the subject of commissions to be part of their listing presentation, especially when they have no control over what's being said. That's certainly not the case in the MLS. Commissions have nothing to do with the MLS listing presentation ... so if listing brokers are giving their permission for use, why shouldn't they be able to control the environment in which the listings are presented? That's why online listings should be treated differently by copyright rights and MLS data-sharing rules.
Non-listing brokers have agreed to a certain level of cooperation. Now some non-listing brokers want to change what used to be an extremely generous content-sharing situation into a personal advantage. The listing broker doesn't owe them that.
These are clear, indisputable examples of how listing brokers can get hurt and why they should have the right to protect their copyright rights with regard to their listings, and that includes sharing them or not sharing them with competitors as they see fit.
