puzzle pieces

The MLS technology model has been relatively flat-footed for some time now. Many MLSs offer one MLS system, one Public Records system and other services like showing appointment software, document management, and they call it a day.

In Part IV of his blog series last Thursday, Bob Bemis outlined a vision of a brand new way for MLS platforms to operate. A new program called AMP™ or Advanced Multi-List Platform™ that would leverage RPR is a very interesting and even scary concept to some. In its simplest definition, AMP would be the “back end” of an MLS. It would provide the database that all listings, solds and other real estate information are fed into and stored in right now. In today’s model, the database of listing information is inextricably linked to the rest of the MLS system in most markets. In this approach, the database would be separated from the agent-facing portion of an MLS system, where functionality like add/edit, CMA, reports, and prospecting live.

As Bob Bemis highlighted in his series of articles, there are many weaknesses with this traditional MLS model. The three largest, in my view:

  1. It does not consider the needs for brokers to differentiate themselves from one another.
  2. It creates cost and duplication of effort for an industry that already suffers from tight margins and a lack of technology adeptness.
  3. It does not allow agents and brokers any choice in the tools offered by the MLS and in many cases forces agents to pay for tools they don’t want, don’t need, and don’t use.

How long have these problems existed? For as long as I can remember. When I first began consulting in the real estate industry more than 10 years ago, I remember my then business partner, Mike Audet, talk about the need for a “plug n’ play” MLS. He had several blog posts and white papers published back then that talked about the need to de-couple every module within an MLS system to allow each organization to pick their own custom collection of tools that would best serve the needs of their organization. Unfortunately, at that time there was no appetite from MLS technology providers to try this practical but revolutionary approach.

Bob mentions in his article that some progressive MLS leaders today are trying to push the envelope, asking fundamental questions about smart ways to re-invent the MLS. One of those leaders is Timathy Dain, CEO of SIRMLS. I had the honor of working with Tim and his organization nearly 3 years ago, to help them think about completely new ways of defining the role and structure of the MLS organization. This work was being done before any of the latest industry initiatives like Broker Public Portal, Upstream and others had even been contemplated. After hearing the news about AMP, I had the pleasure of interviewing Tim to better understand what drove him to ask for such a revolutionary approach to the MLS technology model:

“In 2013 our future scenario planning led us to several conclusions that helped build our road map for the next five years. From the creative writing of you (Marilyn Wilson), Rob Hahn, and one other consultant we reached several conclusions. First, a small MLS is better-off mobile. Second, the portals are not going to vanish, therefore seek partnerships that enhance member services. Third, data is universal and an MLS database alone cannot provide the full property picture. We understood that if we could separate the MLS database from the core functionality like search, CMA, hot sheets etc. we could get closer to a simpler definition of an MLS organization. We wanted to go back to basics, placing the bulk of our energy on creating the most accurate and rich database we could for our members. We also wanted to partner with those that had access to data sets other than just MLS listing information. We could see the trend toward big data and wanted to find a way to help put our REALTORS® back at the center of the transaction by arming them with all kinds of information related to listings like public records, schools, neighborhood information and demographics that we could comingle with MLS data in any application.

“More importantly, we wanted all of these data sets to be seamlessly connected so they could learn more from one another in a single property record system (eliminate duplication), and help our members deliver the most up to date and comprehensive information available so they could use that information to educate their clients.”

Tim goes on to say, “By doing this we thought we could achieve two important goals. We could help our REALTORS® have the best data available and at the same time reduce the size of our own database by working with someone who could reduce or even eliminate our costs of database hosting and maintenance. Bottomline…. we wanted to help our subscribers have smarter information and more freedom to use it in their native environment than anyone else. We felt the old/current MLS system model was not addressing that important need for a single, universal data repository.”

So how well does AMP match the vision you had outlined way back in 2013?

Tim told us that from what he’s seen so far, AMP is a really close match to his organization’s vision. He told us that AMP is NOT an MLS organization or even a full MLS system – it is simply the national database that can fuel development of a whole bunch of interesting modules and functionality that can help REALTORS® be smarter and more well-prepared than anyone else. Tim also strongly underlined the need for AMP to adopt the RESO Data Standards as they become available to help facilitate industry-wide plug n’ play opportunities.

Tim told us that the key to success for RPR is to take this idea beyond just a vision and do the heavy lifting to make it really easy for current MLS technology providers as well as innovative upstarts to be able to easily connect to their system. This may require a re-thinking of the business models and how agents will experience their MLS system in the future.

Walt Baczkowski, CEO of the San Francisco Association of REALTORS® also saw the opportunity for an AMP-like product several years ago. The first thing that Walt asked me to share with our readers….”AMP™ is NOT a National MLS. If you think that’s what it is you should stop reading immediately!”   Why is he so adamant about that? Because he believes that de-coupling the MLS database from the agent-facing features has the potential to re-invent the way MLSs look at their role in the industry, making them indispensable to their subscribers for years to come.

So when asked what inspired SFAR’s interest in AMP here’s what we heard:

“When I arrived at SFAR, nothing had been done to our MLS system configuration in about five years. We tried to start making changes to it only to have the vendor contact us and say they had to hold off on the changes as they were working on another project. We also quickly realized that we were overpaying for a lot of services. SFAR was paying for all of our members to use services that were actually only being used by a handful of subscribers.”

Walt quickly began to question why SFAR was paying for several services that his members were not taking advantage of, not aware of or not interested in. What was his conclusion? “The MLS approach to technology is backwards. The MLS pays for technologies that members don’t use instead of allowing them to proactively choose the menu of technologies that work best for their individual business needs. “

Walt brought forth a simple analogy to illustrate his point. “My house is wired with electricity so that I can plug in whatever appliances, lamps and electronics I would like to. Nobody forces me to buy a lamp if I would prefer a neon light. Why are we “forcing” members to use the suite of technologies that we have chosen for them? Why not just give them the equivalent of an “electrical outlet” and let them plug in their technologies that work best for their business?”

Walt’s investigation led him to the same conclusion that Tim’s did. He said, “Why don’t we just build a robust database that brokers and agents can plug in to any number of technologies?   Why not separate all of the features of an MLS system from the database and then let each broker decide what features are best for his or her agents? In this scenario in theory every broker could choose their own branded listing input, prospecting, CMA and reporting to give each company a way to differentiate their core tools from other brokers.

Walt says, “What if SFAR could offer its members not just a few, but a myriad of “database-connected” technologies that could easily be connected to SFAR’s information in minutes? This would, of course, require training for brokers and agents, but could open up all kinds of ways to tap into the greatest minds in Silicon Valley to build exciting, targeted solutions for REALTORS®. Since we’re located right next some of the best technology minds in the world, this is a VERY exciting proposition for us.”

Now let’s look at another benefit that Walt suggested too. If MLSs weren’t required to offer many under-utilized services they might be able to re-deploy the monies. They could reduce the cost of service or pour the newfound savings into amazing training programs or incredible levels of customer service to help each REALTOR® be more successful.

From what I understand AMP certainly provides a lot of food for thought as RPR begins to work with some thought leaders at SIRMLS, SFAR, and others.

I would love to hear your feedback on this exciting idea.

Disclosure: WAV Group has provided research services for RPR in the past.