The brokers of Hampton Roads, Va., who stand in defiance of a pay-to-view real estate listing feed, deserve a standing ovation. Their defiance sends a strong message that they aren’t buying the dope some folks are peddling. Charging consumers to view home listings will not spur early contact between the consumer and real estate agent. Instead, the Hampton Road brokers believe it will repel consumers in outrage. This position speaks volumes about the crossroads at which traditional real estate finds itself.

The brokers of Hampton Roads, Va., who stand in defiance of a pay-to-view real estate listing feed, deserve a standing ovation. Their defiance sends a strong message that they aren’t buying the dope some folks are peddling. Charging consumers to view home listings will not spur early contact between the consumer and real estate agent. Instead, the Hampton Road brokers believe it will repel consumers in outrage. This position speaks volumes about the crossroads at which traditional real estate finds itself.

As a consumer, I agree. They have it right this time. Except for the “outrage” part. Outrage is the last thing consumers feel. These days, action is the emotional verb that comes to mind. Resourceful as we are, if we’re repelled by something, we either seek alternatives or we invent new ones.

Considering the alternatives in real estate currently tapping into a disenfranchised consumer, this one’s a no-brainer. The alternatives are out there building rapport with us. They’re stroking us with options and lists of services we can read about and understand. Mock them if you must. Argue your merits versus theirs. But if you support a pay-to-view MLS, your argument is transparent, your thinking is terminal, and you are sealing an ill-fated future. Polish the tombstones. I’ll get busy writing the epitaph.

The Hampton Roads MLS wants brokers to believe that we consumers are mere cattle, mindlessly plodding our way to the agent trough. Dangle some data in front of us and we’ll gladly pay a fee just to get it. Moo.

A recent commentary presented a slightly different MLS motive – one that suggests escalating costs are forcing MLSs into a pay-to-view model; that it’s the way of the times; that listing feeds are freely distributed and no different from illegal music piracy; that the time has come for listings to be regulated to replenish the pockets of the MLS.

So which is it? Is the MLS riding a high moral ground in favor of regulation or do they require more than the financial transfusion they currently get daily from Realtors, brokers and IDX vendors? My guess is the latter. They’re hemorrhaging. Pulse is way down. It’s just a matter of time now and they’re grasping at last breaths.

Are listings pirated like music? No. Any argument to the contrary is an insult to brain matter. Unless you reassign the ownership of the listing back to the homeowner and remit them royalties on every cent made from the ancillary income derived from the listing, the argument is chock full of artistic license and so grounded in fiction I’m tempted to call Barbara Corcoran and submit the story line for a production deal.

The comparison doesn’t work because those offering it have no understanding of the implication of piracy and its financial recourse on the true owner of the content. All they see are the distributors of music crying about lost income and then draw loose comparisons. But think about this – in the entertainment industry free music distribution inhibits sales. In real estate free listing distribution enhances the sale. For the piracy comparison to even work we need to figure out who the true loser would be.

In the music industry the record labels, agents, managers, publishers and artists are the true owners of the content. If music is the metaphor, then the MLS is none of the aforementioned. Rather, they are the radio station acting as a promotional vehicle for the home. In music, for every song played on the radio, a performance fee is collected from the station by one of several performance rights organizations (ASCAP, BMI, etc.) representing the rights of the composer. Through a calculated formula, royalties are remitted back to the artists. By comparison, every penny earned from the MLS should be calculated through a formula that remits a royalty back to the owner of the listing, not the MLS!

If the MLS is going to scream piracy and use the music industry as the paradigm, then they should do it for the right reasons: to protect the owners of the content and their representation. Frankly, if home sellers ever got wind of how many people have their hands in the revenue pot and witnessed all the greed, outrage doesn’t come close to describe the emotion. Disgust, perhaps, followed by action.

Home sellers today may not be far removed from the unsuspecting artists of the ’50s and ’60s who gave away rights of ownership of their compositions to label executives who rewarded them with a Cadillac and a pat on the back and then went on to make millions from it. None ever saw residual income from their compositions and neither do home sellers from ancillary use of our homes data. MLSs charge IDX vendors who charge Web site vendors who then have to charge the Realtors for the content they initially gave to the MLS along with their dues. And it’s still not enough. The MLSs want more. They want to charge the consumer to view the data.

Pay-to-view MLSs are not interested in piracy nor are they creating a fair, equivalent model to secure ancillary income streams for homeowners. And they definitely don’t care about placing brokers closer to the consumer earlier. They are motivated by greed and it’s warped their thinking. Hampton Roads brokers recognize that. They’re very worried that the consumer will use this as one more excuse to use alternative models. How right they may be.

Inviting consumers into your experience

Ever go online and click a 30-second sound sample? That’s IDX. A small digital representation of the listing, served up to the consumer, inviting us to step into your experience. Showcasing homes to buyers. Promoting listings for sellers. Doing all this because you’re all about representing our best interests. Not your own. Hampton Roads brokers are against a cartel that wants to be the radio station that charges everyone and then keeps all the revenue. Hampton Roads – if your MLS chooses not to dance to your tune, don’t choose another tune – find another venue.

Brokers and Realtors imagine this: You sign on to represent my home as my agent. Not only do you represent the sale of it but you represent its total income potential as it becomes a part of revenue-producing content stream. If your associations could morph into an ASCAP for real estate and serve to protect all our rights, together you work to push the data through all the content providers who use our data to earn revenue. IDX vendors. Web-site companies. Title companies. Data vendors. Everywhere and anywhere home data earns revenue. Fees are collected, formulas are created that equitably distribute royalties in checks they receive from YOU on a quarterly basis, albeit weeks, months, maybe years after the home sales. And for that service you continue to take your commission. Talk about building client loyalty.

Encore

Hampton Roads take a bow. As they say in the music business – you rock! Let this serve as inspiration for brokers all over the U.S. to do the compassionate thing. In the parlance of our times, pull the plug on the MLS. Free the feeds. And now, I put my consumer hat back on so I can jump online to view broker sites in Hampton Roads and see what investment opportunities there are for me.

Marc Davison is the vice president of corporate development at VREO Software.

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