One week after reaching a confidential settlement in a lawsuit against Move Inc., ActiveRain today announced it will begin charging new members $29 a month to make full use of the company’s blogging platform.
While basic ActiveRain accounts will still be available for free to new members, those accounts will allow them only to network with other real estate professionals.
To get an "outside blog" and a unique domain name allowing them to post content visible to consumers and search engines, new members will have to pay $29 a month.
Existing members can continue using ActiveRain for networking, but will be asked to pay $19 a month for an outside blog. Only users who had created accounts before Feb. 16 and had written at least one blog post will be grandfathered in as existing member accounts.
While ActiveRain claims 135,000 members, only about 20 percent of those have ever contributed a blog post, said Bob Stewart, ActiveRain "community evangelist."
Although Stewart did not provide a tally of active members, those numbers suggest that less than 27,000 ActiveRain members are being grandfathered in.
The new membership policy, announced by ActiveRain’s "community builder," Brad Andersohn, in a blog post, got a mixed reception from ActiveRain members.
"Well thank goodness I’m already here because I would really hate to leave and I would have to cut back on something else to stay," commented Krista Fuchs, a Chester County, Pa., Realtor. "I know the people in my area won’t pay for this, at least the ones who I’ve talked to. They were skeptical when it was free and that was when we had a better economy."
Missy Caulk, an Ann Arbor, Mich.-based Realtor, commented that while she had no problem with the new policy, she thought ActiveRain should consider giving new members 30 days of free use "to see if they will appreciate what we have here."
ActiveRain bills itself as a collaborative blogging platform, with the collective efforts of members improving the site’s search-engine rankings. Thanks to the time and effort of founding members, the site draws more than 2 million visitors a month, Andersohn said.
"The amount of consumers visiting the site is dramatically higher, and the potential to learn, interact and share are all exponentially greater than they were two years ago," when ActiveRain was getting off the ground, he noted in his blog post announcing the new membership fee.
Asked about ActiveRain’s ability to remain competitive in an increasingly crowded field — sites like RealTown, Zillow Community, Trulia Voices and RealSeekr offer similar opportunities to reach consumers — Andersohn and Stewart told Inman News that membership charges for such services are becoming more common.
By allowing new members to continue to register for free accounts that allow them to network only with other real estate professionals, they can learn about the site’s benefits directly from other users, Andersohn and Stewart said.
Stewart said another source of revenue for ActiveRain is a pay-per-click "listing router" that allows real estate agents to pay for traffic to their Internet Data Exchange-based listing sites. (IDX is a system for real estate data exchange.) That service will continue to be available to both free and paid members, with clicks delivered to the highest bidder on an auction basis.
Stewart said the decision to institute a charge for new members was not related to last week’s settlement with Move Inc.
The settlement resolves ActiveRain’s August 2007 lawsuit against Realtor.com operator Move Inc. after that company backed out of a planned $30 million acquisition of ActiveRain. ActiveRain accused Move Inc. — which later launched its own blogging platform — with breach of contract, violating the California Trade Secrets Act, and fraud and unfair competition.
Although the case seemed to be headed for a jury trial, attorneys for Move Inc. filed notice Feb. 9 that a settlement has been reached. The settlement is confidential, and both sides will ask that the case be dismissed, said Jerry McNaul, an attorney who represented ActiveRain in the dispute.
After Move Inc. backed out of the deal to acquire ActiveRain, rival HouseValues acquired just under one-third of ActiveRain’s shares for $2.75 million, according to court documents filed in the case. HouseValues also acquired the right to buy all of ActiveRain’s remaining shares for $25 million during the first half of 2009, attorneys for Move Inc. said. The price will grow to $40 million if HouseValues waits until the second half of 2009, and $60 million if the company waits until the first half of 2010.
HouseValues did not respond by press time to a request for comment about whether it planned to complete an acquisition of ActiveRain.
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