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May052008
CMLS Rules Obstructing Competition
I’ve been interested in the real estate market for most of my professional career. Not the buying and selling of homes but specifically in areas where real estate touches the internet. I’ve worked for two real estate technology start-ups (that shall remain nameless for the sake of good karma) and in each instance I only grew more interested in it. So naturally I’ve still followed this stuff over the years. I’ve always known the Columbia Multiple Listings Services (CMLS) to be behind the times, in a major way for most of their existence. This lawsuit by the Justice Department against the CMLS comes as no surprise to me.By providing an efficient means of exchanging information on home listings, MLSs can benefit consumers, but that same role makes access to the MLS database - and therefore MLS membership - critically important for any broker seeking to serve clients efficiently in the MLS’s service area, the Department said. Consequently, the rules adopted by CMLS governing who can be a member and how members must run their businesses have a significant impact on competition among brokers in the area served by the MLS.
This is the rub, they provide the service but they control the data as well. Realtors willingly give them their data, and even pay to do it in one form or another. I’ve always thought of starting a 100% free MLS service for the Columbia area, but CMLS has always been the warlord of the area and significantly controls the mind-share of the local Realtors.
The Department said that CMLS’s rules also give Columbia real estate brokers the ability to exclude rivals from outside Columbia who might offer local consumers innovative brokerage options that save them money or provide services that better match their needs. The Department’s lawsuit challenges these and other CMLS rules that unreasonably restrain competition among real estate brokers and thereby lead to reduced consumer choice and higher fees paid by consumers.
Did you know the only way you can gain access to the CMLS data is if you are a licensed Realtor?
There you go, it’s all about the money right? By controlling the data they control the money, clever. I have to think that by keeping the technology that powers the MLS itself they also control the money by controlling the way you can access it.
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Posted at 10:50 pm on 05/05/08
Jason Johnson
Woop! Woop!
My entire family being involved in real estate (except me), I know the pain realtors have had with the CMLS service and software. In the last few years, they upgraded to a web-based (from client/server) system, and it was horrid. When they rolled it out, I remember watching friends and family dependent on the system literally hanging their heads in disappointment (and worried they wouldn’t be able to serve their customers properly), but with no alternatives, CMLS left them locked in and miserable.
Competition is healthy. It keeps you giving your customers the attention and service they deserve. Without competition (and the threat of losing a customer to somebody else), everything stagnates… CMLS being a prime example.
Posted at 6:31 pm on 05/10/08
Gene
Personally, I think it’s a prime example of a small group of people who are taking advantage of a larger group through sheer mis-understanding of technology. Meaning, CMLS is holding all these Realtors hostage because they don’t understand what could be, which also limits any scope for there to be any real competition developed…