by Alex Lange, CEO of Upstream
Ahhh…. March Madness. I love everything about it. Team dynamics, competition, and the sheer will to win. If you give any credence to the media, you'd think there's a game to be won within the real estate industry for control of data management. That's understandable. Looking at how our industry has been evolved over the past 18 months, it’s clear that most data vendors and portals also see the need for an "Upstream like" data repository. Many vendors and portals (and some MLS’s) have either introduced one or are working on one.
So, we seem to have a consensus that property data must be better managed, and perhaps in a single source location. The question is no longer "is it needed?" but "who is the best entity to create and operate the database?" Every entity creating their personal "Upstream" is fighting to obtain a significant critical mass of data to ensure they become the standard for data management and control.
Vendors will position their "Upstream" as a free (or nearly free) incentive to leverage your collective data to get you to commit to their products and services. There is no free lunch: what is given away up front always has a price somewhere down the line. It’s a familiar model that portals have used to move into a control position for consumer website interaction. As an industry, we gave up that position of control and without efforts like Upstream, are precariously headed there again.
To be clear, these are not evil companies trying to destroy our industry. They rely on our industry for their livelihood, but make no mistake: they do not share our goals and objectives. They are looking to monetize the data for the benefit of their company, while brokers are looking to manage the data to benefit our industry. There’s nothing wrong with either, but the two will not always be aligned. The good news is that both a for-profit and an industry centered solution will benefit the consumer in cleaner, more accurate data so consumer benefit need not be drawn into the conversation.
A neutral, standards-based, database is more likely to offer an open, vendor-agnostic platform. It would foster vendor competition by forcing their focus on industry and consumer benefits. Any vendor-based solution will have the potential of favoring their system- like the way Microsoft dominated the office productivity suite for so long.
Can a third-party vendor do a better job than Upstream in creating a single database for brokers and agents? Possibly. However, the industry collectively asked: What would we do differently if we started over? How can we improve distribution to consumers while maintaining control of our data? After all, we are also trustees, with a fiduciary duty to our customers. Our listings contain the home information of our customers, and we are duty bound, by law, to steward that information in a manner subject to the highest standard of care. The answer is Upstream, and together we have the resources and talent to make it the industry standard for data management. But it will require a collective effort, and if I wasn’t clear before; it is in the best interest of every vendor creating a competing product to attempt to break up that collective effort.
Some of you may have concerns about the cost of Upstream and the massive number of moving parts to get it up and running. Fortunately, the competing products all have similar issues and may wind up helping Upstream through some of the logistical issues. There are also some concerns about RPR; which are all issues to understand and manage. However, none of these concerns measure up to giving up control of your data to a third party whose goal is to maximize your data’s value for their company’s benefit. Ask yourself: who is most likely to have the best interest of the brokers and sales associates at heart? Even if Upstream does not fulfill its promise, the solution is to continue trying, not simply rolling over and allow a third party to step in again and own our data repository and forgo our fiduciary responsibility.
I’m sure many of you are comfortable with a portal/vendor model of Upstream. After all, it follows a free market concept of competitors fighting for your data to drive down costs. However, those competitors have a single focus, to be the only collective source of your data. It will stop being a "free market" solution when they consolidate into a single provider, resulting in the same situation you complain about now with listing portals. Upstream seeks the economies of scale that a single platform provides while maintaining that only the broker should control their data assets.
Sadly, the fragmented nature of our industry has allowed vendors such as newspapers, relocation companies, and web portals to build very strong businesses by essentially strip-mining our resources. Sometimes, these outside vendors have been the best solution. However, listing information is one of the core assets of our industry; it makes the most sense for it to be stewarded by the practitioners who bear the fiduciary responsibility.
Viewing these entities as competitors forces us to make comparisons, and comparing each offering feature by feature is merely a race to the bottom. When you honestly evaluate core values, stakeholders served, profit motive, and where control is centered, the difference is ‘night and day.’ 2017 can be the year of the practitioners. Let’s take back control of our data assets as a team. Let’s be intentional in our outcomes. Let’s not forget… when it comes to your business, this is not a game.
We seek to create efficiencies by reducing redundant entry, help brokers distribute deliberately by giving them control over who can access their data and inspire innovation by removing artificial barriers when the broker allows.