Technology

Regulators may be weighing impact of Zillow-Trulia merger on small brokers

Big brokers and franchisors may be in a better position to resist potential price increases

Much of the discussion about the Federal Trade Commission’s review of the pending Zillow-Trulia merger has centered around the share of advertising dollars that the portal giants command and the percentage of consumer traffic they represent. But another factor may play into the FTC’s analysis on whether the merger might harm competition in the real estate portal space. Zillow, Trulia and realtor.com routinely cut deals with many of the nation’s largest brokerages and franchisors to purchase advertising at favorable prices that helps them capture more leads from the popular popular search portals. These arrangements, which give larger real estate companies an advantage, may complicate the FTC's review. When examining possible adverse competitive effects, the FTC considers whether those effects vary significantly for different customers purchasing the same or similar products. Such differential impacts are possible when sellers can discriminate by raising prices for certai...