WAV Group facilitates dozens of MLS strategic plans each year. Once resounding question heard from Associaiton Shareholders and Broker Participants is “How do we generate more non-dues revenue outside of our ranks.”
Last night, a new revenue source came to mind. As we all understand, distributing listings to IDX vendors and managing IDX contracts is heavy lifting. Most MLSs charge vendors anywhere from $500 in small MLS markets to $10,000 per year in large markets for RETS access to MLS data. Agents and brokers bear this fee as an added cost of the services they buy from vendors.
What did not occur to me until just today is that Third Party websites like Trulia and others are not paying for the broker data feeds coming from sites like Listhub or Point2. Lets look at the revenue potential.
If an MLS charges $1000 per month per feed for IDX, and Listhub distributes MLS IDX data to 46 websites, and Point2 distributes data to 60, then the MLS could generate $106,000 per month in revenue from Syndicaiton to third party websites. The MLS could redistribute that money, or some part of that money back to their member brokers as a license payment for thier listings, or reduce fees that brokers pay for MLS services.
What would likely happen is that dozens of third party websites would not be able to bear the burden of the fees, and shut down. For that matter, they may all close their doors. What would be left are agent and broker websites who are already paying the fees. I think that consumers would be just as happy. Don’t you?
The reality is that if third party listing websites had to bear any fraction of the cost that the broker and agent invests into curating MLS data, they would fail. By the way – while you are at it, please require the thrid party websites to enter into the same IDX agreements that brokers and vendors need to enter into. Trust me, your brokers will applaud you for leveling the playing field for the first time in history!