But what quickly became obvious to me was that not has the tech revolution come to the real estate business, but that, in fact, there is something of a technology arms race going on right now.
This competition is taking place on a number of different fronts. Some are identical to the changes taking place across all professions – broadband Internet, streaming video, office management tools, financial and productivity software etc. All were in evidence at the show.
But the big tech battle in the real estate business these days, the Apple-Microsoft of the realty game, is being fought across multiple platforms and is for control over the biggest database in the industry: listings. It’s the classic story – ten years [ago] , if you were a realtor and you want [ed] to list a home for sale, you sent the information and a photo to the local multiple listing service, which printed it up in a book that was then distributed to all other agents in the area.
Needless to say, this paradigm got blown apart with the rise of laptop computers, the Web and smartphones. Suddenly, there was a whole bunch of ways to list a house for sale, including mainstream operations like Craigslist, eBay, Google, Yahoo, and specialty sites like Frontdoor, Cyberhomes, Homefinder.com, and RealEstateBook.com.
But the traditional multiple listings companies didn’t just roll over under this assault. On the contrary, having access to far more information (taxes, liens, etc.) and far more members than the Web upstarts, they responded by virtual themselves, bringing heavy computing firepower to bear to create sophisticated websites that not only claimed to be more inclusive, but more complete than non-Realtor® services. They could also reach out and draw information from their professional counterparts around the country.
As with all such tech wars the real winners have been the users. The big newcomers like Yahoo have been forestalled from merely skimming off the easy money in this field, while at the same time their presence has forced the veteran industry companies to stay innovative. Meanwhile, the new start-ups have been a source of fresh ideas that the rest of the competition has been compelled to adopt.
A case in point is MLS Listings Inc., the service that covers not just Silicon Valley, but much of Northern California. Just a few years ago, it was a sleepy local multiple listing service with clunky software and not a lot of competition. These days, it’s one of the most technologically innovative listings services in the country, having at the same time merged with a number of its neighbors in order to maintain competitive mass.
A couple years ago when MLS Listings brought in its president, Jim Harrison, one of the industry’s most innovative CEOs, his mission was to bring the firm into the 21st century. He’s done just that, with a massive overhaul of the entire company, not least its web presence – from the user interface to privacy protections to new caches of data (such as taxes) to multi-media.
Says Harrison, with his Texas drawl, “The simple fact is that we have to run as fast as we can because the competition is always right behind us.”
The result is that MLS Listings these days is less a real estate company or printing house than it is a software developer. And that’s true as well for its competitors. Meanwhile, the race has only just begun. The next challenge is deliver data to multiple locations – including social networks like Facebook, Twitter, etc. – on multiple platforms, from laptops to cellphones to automobile dashboards. Sitting right behind that is the integration of all of these vast stores of information and the delivery of it in real time – i.e., as the real estate agent drives a client couple through a neighborhood, that agent is constantly being fed updated information on what homes have just been listed or sold, price changes, mortgage rates, liens, virtual tours, as well as GPS and maps to the next listing.
It won’t be easy. Jumping aboard the runaway train of high technology is always a scary business. The train keeps accelerating and forever risks jumping the track. And you never really know the final destination. But, as the numerous Web-related companies at California Realtor Expo 2009 suggest, if want to keep playing it’s the only game in town.
Here in Greenwich, the Greenwich Association of Realtors devotes most of its efforts to keeping competition out, rather than making real estate searches easier and more informative. We still cling to the business concept of being the holders of all information; the obsolete listing books still carry a warning that loaning them to a customer will result in a slow, lingering death by burning, for instance, prices and addresses are withheld from advertisements, and we never, ever share our data with realtors from out of town. I can think of no entity, whether a civilization or business, that has successfully defended its existence by trying to hold off the barbarians with walls, rather than innovation. Ask Rome, American car manufacturers or the newspaper publishers if you doubt my word.