Many of us in real estate are reading about something that we don’t understand. It is called “Upstream.”

It has been stated in some online media that Upstream could be good for everyone.

Many of us would like to know more about who/what Upstream is, what it intends to do and what effects that may have on everyone in our industry.

Here is what we have been told: (Limited) news about Upstream states that it is driven by “public interest.”

But where and how does public interest intersect with self-interest?

Many small brokers see Upstream’s efforts as an attempt to protect and enhance selected interests, not the industry’s interests or the public’s interests. Where and how do non-Upstream member brokers, agents and the public benefit from Upstream and its initiatives? I don’t think we’ve been told.

What is the relationship and extent of cooperation between Upstream, Realtors Property Resource (RPR) and NAR? I haven’t read a clear explanation of that yet.

Many of the top executives operating real estate holding corporations have never sold even one home.

Unless these executives have sold at least a few homes, how can they understand the real estate brokerage business — and how can they pretend to be qualified to reshape it?

What does consolidation and industry efficiency bring to the table? Corporate shareholders’ money can be used to purchase and consolidate many small real estate brokers into a few aggregated mega-operators for economic efficiency and gain.

What is the cost to consumers and smaller brokerage operators of consolidation and “upstream” management practice? My prediction is that large-scale brokerage gets bigger and more powerful, and that will lead to major shifts in how real estate is sold in this country.

Economists call market control by a few big operators an “oligopoly.” Is that beneficial to anyone other than the big real estate brokerage holding companies and their shareholders?

Upstream supporters defend their mission to go “upstream” with some reasoning that doesn’t make sense to many:

  1.  No one except a listing broker and its agents are as qualified as themselves to sell their own listings. Really?

I sell my own listings. I allow (and compensate) other brokers and their agents to sell my listings, and I also co-market (with permission), show and sell my competitors’ listings — and my clients think I do a good job of being fair, balanced and professional. Many brokers do an equally fine job of selling other brokers’ listings.

  1. Upstream also does not sound pleased that listing aggregation portals have monetized data, which contributing brokers have voluntarily shared through MLS and direct broker data licensing agreements (DLAs).

Now it sounds like Upstream would also like to go upstream of the big portals (, Zillow, Trulia and, too — at least in terms of getting a piece of their earnings, or possibly even owning them.

  1. Some brokers (possibly some who are members of Upstream) are no longer offering compensation to buyers’ brokers in their MLS listings.
  2. Some brokers are withdrawing from participation in their local MLSs.
  3. Some brokers have openly discussed joining other mega-brokers to build a “national” MLS.

Are any of those brokers Upstream members? I don’t know.

Before I accept that Upstream is good for everyone, I’ll start by asking if it is better for anyone.

Given: There are only X number of real estate transaction sides and Y commission dollars on the table in any given period of time, and competition (fair or otherwise) determines the spread and ownership of each.

Question: If “more” goes into Upstream backer-brokers’ pockets, then from whose pockets will that additional share be taken?

Answer: Commission dollar and market share will be taken from every non-Upstream-affiliated agent’s and broker’s pockets.

If Upstream members can’t maintain an acceptably profitable business model and offer cooperative brokerage opportunities though offers of meaningful compensation via local association MLSs — and evidently some cannot — what will they do next?

Is Upstream a new collaboration that wants to revisit the 2005-2008 National Association of Realtors-U.S. Department of Justice unfair competition and antitrust business practices drama, but with a different twist and a better outcome for themselves?

Will Upstream attempt to go “upstream” of anyone who is not on its team?

Steve Wiley and his wife, Mary, own and operate Smarter Choice Real Estate, serving the Lincoln, Nebraska, metro area.

Email Steve Wiley.

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