What should an MLS subscription cost?

In the old paradym there is one system and one price for all members of the MLS, generally referred to as “subscribers”. Associations have “Members”, MLSs have “Subscribers”. The price is negotiated by the MLS Committee or Board of Directors in each city with the assistance their staff and counsel. MLSs vendors generally bundle services such as Tax Data, Statistics, Showing Scheduling, and the like into the price which ends up being presented to the MLS Committee/BoD as a Price Per Member per Month. The bigger the MLS, the smaller the price per subscriber, because all Subscribers pay whether they ever actually login or not. That’s called a Site License and it’s how almost all MLSs operate today, so that’s what it cost today. But what should MLS cost? Let’s think about what MLS-Next might look like without the one-size-fits-all nonsense.

What Should MLS Cost?

So, for illustration purposes, a 1,000 member MLS is paying $10/subscriber/month for their MLS software. That comes with an input form to collect the data encoded with the MLS’s specific business rules so the data complies with MLS Rules & Regs as well as other data integrity rules. For example, the price can’t be zero, the listing agent ID has to be a valid, the closed date can’t be prior to the list date, and literally hundreds of others. In addition to capturing the data, the software will also include rule-based change forms, automated processes that expire listings based on dates and business rules. Also reporting from Consumer Reports to CMAs and Multi-property flyers, there are dozens of those and most also include a Report Builder so Subscribers can create unlimited styles and options for their clients. The MLS will also include support for a handful of integrations with Tax Data, Rental Data, outside reporting services, and integrations. All that for $10,000/month or about $120,000/year on a 3-5 year contract.

In the standard environment the 1,000 users all have to use the same software to both manage their listing inventory and also their customers. A core function of the MLS is of course to capture the data in an organized way, as we described above, but then most Subscribers also use the MLS to send updates to their clients. Subscribers use the MLS to describe the parameters a buyer is looking for in a new house, and to send them an email when something new comes on the market or something changes. This drip marketing function is a core service delivered by the Subscriber to their clients and most, according to a recent survey, use their MLS for this. So the emails every customer in the market are receiving from their Agents are, the same.

Fast forward to 2023, November 29th to be specific, and the 16,000 Subscribers in the Triangle MLS will find that the data, the listings that we capture with our rule-based forms, has been separated from that second part. The software Triangle users decide to license to talk to their clients will be up to them, not me and my staff at the MLS. And, to begin with, there will be three: Paragon, the one all 16,000 use now, plus two of the other national leaders in the MLS space: FBS and CoreLogic. Its a goal I have had for a long time, and not just me, it’s a goal our industry has been working towards for at least a decade. To push the purchase decision out of the MLS Board Room and into the offices of our Brokers and Agents.

Maybe it’s a little like IDX software in our industry. The MLS does not dictate who our Brokers can use to power listing search on their websites. They have to sign a Third Party License Agreement since they will be holding MLS data on behalf of the Broker, but we know how to make that easy. We support thousands of those sites from hundreds, certainly dozens, of IDX vendors. Its an active marketplace with a wide universe of prices from free to thousands of dollars a month.

So, what should MLS cost?

Who knows. Thankfully in America we mostly still believe in the power of the market to answer questions like that. At launch in November all options will cost the same. Base MLS membership costs $X and comes with the ability to add and edit the listings plus one of the three MLS systems. To add a second system it costs an additional $Y, a third is the same, $Y. So, to be clear that’s $X a month for one, $X+Y for two, and $X+$Y+$Y) for three. In dollars, say X=$50 and Y=$25 so $50 for one, $75 for two, and $100 for three. Those prices are subject to change of course and likely will change. I think it’s strange that they are the same. Like if you went to a restaurant and everything on the menu was $39. That would be strange, and would mean there was some funky math happening back in the kitchen.

That means the answer to our question, what should MLS cost, depends on who you are. Right now the options cost the same to make the transition easier for our 16,000 subscribers for whom all of this is new and confusing. But that’s the only reason they cost the same and that will always be the reality of the marketplace, it almost can’t. Those conversations have lead to some really fun questions. So, if Brokers get to choose whatever options the MLS software companies can work onto the Dashboard, what would a product look like that cost $250? Or $2500? What if a team could choose a complete customer engagement system from 1000 Watt or Agency McKenna? The MLS could automate the property and license data sets and provide programatic access to everything through our shiny new API.

On the other end of that spectrum we already anticipate a $50 option that does not come with an MLS system. Brokers and Agents working for certain tech-heavy national brands do not want or need to use Paragon or Matrix or any of those platforms because they have their own. Soon, when can receive as well as send data through a rules-based API, Brokers with the right tech will submit listings from their own platforms and never need to use MLS software at all. Their people can work entirely within the firms branded environment and never leave. That’s optimal for any business. So, when they signup in the future, they will pick a new API-Key-Only Option which still includes full MLS membership but no software, since they don’t need it.

Either way, whether it’s $25 or $2 or $2,500, the MLS of the future will support them all, but we won’t compel the use of any of them. That seems like a decision best left to the real estate professionals themselves.

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Be Collegial

Triangle MLS: Innovating through Close Collaboration

At Triangle MLS, we believe that collegiality is essential to success. That’s why we’re committed to working with vendors who share our values of cooperation, collaboration, and innovation.

We recently made the decision to give our Subscribers the choice of which MLS software they use. This was a bold move, but it was the right one for our community. It means that our Subscribers have the freedom to choose the software that best meets their needs, without being locked into a long-term contract.

We know that this new approach will challenge some of the traditional ways of doing business in the real estate industry. But we’re confident that it will ultimately lead to better outcomes for everyone involved.

Here are some of the benefits of our new approach:

  • More choice for Subscribers: Our Subscribers now have the freedom to choose the MLS software that best meets their needs, without being locked into a long-term contract. This means that they can get the most out of their MLS investment and avoid paying for features that they don’t need.
  • More innovation from vendors: When vendors are competing for business, they have a greater incentive to innovate. This means that our Subscribers can expect to see new and innovative MLS software products and services in the future.
  • A stronger MLS community: When vendors and MLSs work together, they can create a more cohesive and supportive MLS community. This benefits everyone involved, from Subscribers to vendors to MLS staff.

We’re excited to see what the future holds for Triangle MLS and the real estate industry as a whole. We believe that our new approach to vendor selection is a step in the right direction, and we’re committed to working with our vendors to create a better experience for our Subscribers.

To our vendors:

We encourage you to embrace the spirit of cooperation and collaboration that is at the heart of our new approach. If you have confidence in your product or service, you should be happy to compete in a marketplace where Subscribers have the freedom to choose.

Here are some tips for succeeding in the Triangle MLS ecosystem:

  • Be open to collaboration and integration. We want to work with vendors who are willing to work together to create a seamless experience for our Subscribers.
  • Be innovative. We are always looking for new and innovative MLS software products and services.
  • Be committed to customer service. We want to work with vendors who are committed to providing excellent customer service to our Subscribers.

We look forward to working with you to create a better future for the real estate industry.

Getting MLS Out of The Way

Standard Operating Procedure for MLSs has, admittedly, been bad for innovation. Terrible, really.

For my thirty years in the business, there has been one way to enter listings, and one way to work with them: through whatever MLS software some Board committee picked. Then, every Realtor and appraiser in the market was forced to use that software for everything. For three to five years until, just when everyone gets accustomed to using it, the committee votes to switch again. It’s great. People love that.

Actual (not fantasy at all) MLS Server Room deep under Dupont Circle, or some other circle.

To make things worse, the person leading the MLS is usually also the CEO of the Association of Realtors that usually owns and operates the MLS. Not always, there are some big ones that have their own leadership but in most places, the MLS Director is also the Association CEO. These folks usually come up through the Association as Government Affairs, Finance, or Membership Directors, often Legal. And, they are some of my closest friends and a big reason why the industry has been so fun and rewarding. But they are not, as a rule, Subject Matter Experts when it comes to technology.

So, that creates a situation where a non-technical management person is leading a group of non-technical real estate people making what are fundamentally technical decisions. An unfortunate but not terribly surprising outcome of this dynamic is a general over-reliance on the vendors to do, well, everything.

Black Knight, CoreLogic, and Flexmls, and to a lesser extent, Rapattoni, DynaConnections, SEI, and, back in the day, Solid Earth have dominated the MLS-tech space for decades. These are all very good companies run by friends that I trust and respect. No. Seriously, I mean that. I won’t even start to try and name them all, they know who they are, and they know those relationships mean a great deal to me. Despite my personal affinity and respect for them, in my new role I now see how this is underserving most MLSs. The vendors have too much power and control, their agendas dominate strategy, and they sometimes forget, the companies not the people, who owns this information in the first place. I am thinking of some mortgage giants looking at MLS as a source of leads. Just because MLS Subscribers use Software A to store their leads, does not mean the publishers of Software A have any access or rights to use or even see the confidential information stored inside Software A.

If I store my tax returns in a mini storage warehouse, the owner of the warehouse does not have the right to access, see, or use any information inside the leased space. This is no different, and TMLS will never sign a License Agreement that challenges the ownership of our Subscriber’s confidential information. So, before we get to the architecture of “getting out of the way”, let’s pause for a moment to remind ourselves that we are talking about protecting someone else’s valuable property left with us for safekeeping.

Like an original song, painting, or movie, the creator of those works owns them. In our context, the Intellectual Property, or IP, is centered around the listing agreement. Thats the contract between the Listing Brokerage hired by the owner to sell their, house, farm, condo, or whatever, and the Owner. The broker owns the contract, and usually the Exclusive Right to Sell the property in question. She owns the photos she took, or a license to them if she hired a photographer, and most documents she uploaded describing the property. She uploaded this material to our website, entrusting it to us, the MLS, to share it with authorized real estate professionals solely for the purpose of marketing and selling the property. It is her intellectual property that, when added to all the others, creates the critical mass, the positive network effect that defines the collective and creates the MLS’s core value.

So, at the MLS, our job is to build and maintain that list. And to add to it where we can, and to constantly check the records for errors, potential fraud, inequity, or other undesirable economic outcomes. Our job is not to build or even think too much about the software our Subscribers use in their own businesses. As we’ve described, almost all MLSs choose one system for an exclusive contract term. All listings must be entered through that platform, and all searches and prospecting, statistics, public records access, CMAs, drip marketing happen there too. Unless the Realtor or their Broker has heavily invested in their own tech, most Subscribers rely almost exclusively on the MLS software to operate their businesses.

But what if we changed all of that.

The particular software platform a Subscriber chooses to use the information in the MLS is less important to us. Mainly, we don’t want to be a roadblock to any novel way an innovator my find to incorporate the information into their businesses. Forcing people to use one interface feels like monoculture. Like it’s anti-choice, anti-diversity, anti-openness. We don’t want to be any of those things.

For the last several years in The Triangle region, as most places, to enter a listing there was one option: Black Knight‘s Paragon system. Lack of choice is not the only issue here, what if Paragon was down for days or weeks like Rapattoni’s MLS system in August 2023? If that was the only way to manipulate the listings we would be down. That is an unacceptable business risk.

TMLS Network Diagram September 2023

Because system architecture is one of those things I needed to understand as a software CEO, I spent considerable time studying, attending seminars, and interviewing technical experts to try and learn what an “optimal” configuration might be. Engineers and our friends at RESO have been futurecasting the optimal future MLS for years and, happily, the answer is not new, and does not require new inventions to make it real. Other industries have figured this out and built systems that effectively communicate in a rule-based way so that related systems can work together and scale through automation, like the one illustrated in the TMLS Network Diagram from Sept ’23.

What are the building blocks?

  1. Standard Data: It starts with data that is similar enough to be shared across boundaries without unnecessary and inefficient ETL processes. RESO originally reported over 500 types of “status” and more than 400 existed in only one MLS. It’s really hard to share listings when the “threads” don’t line up. Triangle Data is compliant with RESO’s latest Data Dictionary, version 2.0.
  2. Standard Rules: If rules are different it produces a race to the bottom, meaning the MLS with the least rules weaken the viability for everyone and make the whole dataset less or even unreliable. All five Triangle Stakeholders abide by the same rules.
  3. Open Data Policy: For Subscribers, Triangle makes data available in multiple ways including all three major MLS interfaces from Black Knight, CoreLogic, and FBS, as well as high-availability, RESTful APIs for Subscribers requiring only data. This Front-End-of-Choice was made possible because of the years of work at RESO normalizing hundreds of disparate datasets.
  4. Enriching the Data: When a Subscriber enters a listing into the system, Triangle checks other trusted databases for things like green energy features that may be registered at the address, or whether fiber internet is available. The TMLS system adds these fields to the information provided by the Listing Broker to make it easy for her to provide those choices to her clients.
  5. Compliance and Auditing: We can check to see if the property described by the Listing brokerage matches trusted data sources from Government and other places. Artificial intelligence routines constantly scan the images and documents uploaded along with the listings tagging aspects of the information. Missing and conflicting information is reported to the Listing Brokerage who is prompted to improve the accuracy of the listing and the system by confirming or challenging the alert. The result is a dataset that is more reliable and more complete than other sources of real estate information.

So for all of those reasons, coming this fall, Triangle MLS is going to be MLS agnostic, Front-End-of-Choice, or just “Choice”. All three of the major MLS platforms will be available to Subscribers of TMLS. Black Knight‘s Paragon system used now by all 15,000+ members will remain the default MLS platform for all users and will continue to work as normal. But if the Subscriber prefers CoreLogic Matrix or FBS’s Flexmls, or they have their own platform, they can choose none, one, two, or all three. Triangle’s job will be about ensuring the data is accurate and complete in all supported interfaces. The days of steering Subscribers to one platform or another are over in the Triangle.

Multiple ways to look at weather data.

That configuration is something like apps on a phone. I have three weather apps that do slightly different things. All three use the same National Weather Service data to produce their displays (by accessing an API), but one has a cooler radar, another has better alerts, another has nicer hurricane maps. I bounce back and forth between them during severe weather. Maybe MLS will be like that in the future. Instead of being married to one for years, the Subscribers get to compare and move around if they want to, or use one for some things and another for something else.

Spreading the data around also reduces single points of failure. If there are multiple ways to get to the data, one or more of them could be offline and there would still be a way to do business. The benefits of this architecture are many, and the costs are present but manageable. It means that all three will be more expensive on a per unit basis, since no one gets an exclusive. But that also means that we will never tell Black Knight to uninstall Paragon. Never. Can other Black Knight customers say that? As long as my Subscribers want to use Paragon, we will support it. That changes the relationship in a material way, in a positive way. Yet another reason to change the way we do things and, finally, get out of the way of innovation. Its part of becoming the best MLS in the business.

Interested in PropTech stuff? Watch for more on Triangle’s social feeds and occasionally on this site. Also, come out to PropTechSouth.com, the South’s Premier Property Technology event of the year.