BPP 2.0: Seven Questions

From RISMedia, we get some high-level concepts on what BPP 2.0 (Broker Public Portal) will look like. Or at least try to look like. According to the story, BPP 2.0 will be built on three pillars:

1. National consumer platform created through technology reciprocity
2. National dataset created through MLS reciprocity
3. National display ruleset

Read the whole thing.

Since news broke that the BPP-CoStar marriage ended in divorce, which I wrote about earlier, I have been waiting for some sign as to what will happen to BPP. Now we have some ideas. But they’re high-concept, so I have some questions. In fact, I have seven questions as that number is sacred to Notorious and to the Lord of Hosts.

Question 1: Who Will Build BPP 2.0?

The most obvious question is who exactly will be building BPP 2.0. Throughout the history of BPP, the brokers (and MLSs) who came together never did choose to put in enough money to build the damn thing. BPP always sought partners, first NAR (via its RPR subsidiary) and then Homesnap. [NOTE: I might have that wrong; RPR might have been Upstream only, not BPP. It’s been a while.] It made financial sense since building a real consumer website is an expensive proposition. Apparently, things have changed.

According to the RISMedia story, the consumer portal and mobile app will be built via “reciprocity” and “open source”:

This reciprocity will be created by innovations licensed from brokers, MLSs and vendors that develop consumer websites and mobile app components. Said developments will be “open sourced” to BPP brokers, MLSs and vendors.

The BPP will have a national search site and corresponding mobile app, which will also be licensed by BPP for “cloning” by MLSs and brokers who wish to engage consumers directly with local listing agents and brokers – much like brokers providing “cloned” websites to their agents.

Developer tools will enable BPP MLSs and brokers to customize their consumer-facing platform and “make it their own.” Any innovation developed by BPP participants will be available to all MLSs and brokers who wish to participate in technological reciprocity.

If I understand this correctly, BPP 2.0 will be built by a variety of brokerages, MLSs and tech vendors on an “open source” basis.

So the answer is, in a way, nobody will build BPP 2.0 because everybody will build BPP 2.0.

Question #2: Why is “Open Source” in Quotes?

Seeing as how I am a huge proponent of open source software in real estate, I am extremely encouraged that BPP 2.0 will be an open source development.

Except… the phrase is in quotes. Which implies that maybe it isn’t actual open source, but pseudo-open source. Something like, “Yeah, it’s kinda open to paying members of BPP only.”

If the latter is the case, then it isn’t open source at all. And someone (likely the BPP Board of Governors) will retain control over the technology, product decisions, and development priorities. That isn’t open source; that is very much closed source, just one that is owned by a coalition.

This is not merely an academic question. The article makes clear that BPP 2.0 will be “created by innovations licensed from brokers, MLSs and vendors.” Do these licenses keep the intellectual property of the code with the brokers, MLSs and vendors? If so, that isn’t open source. If they require that those providing innovations actually open source the code, that would be fantastic… but that isn’t the vibe I’m getting here.

Question #3: Technological Reciprocity?

Related is how exactly “technological reciprocity” will work in BPP 2.0. From the story:

Developer tools will enable BPP MLSs and brokers to customize their consumer-facing platform and “make it their own.” Any innovation developed by BPP participants will be available to all MLSs and brokers who wish to participate in technological reciprocity.

Okay, I understand developer tools. I get the “if you’re in the technological reciprocity, you get to use everything” concept.

What I’m curious about is how the weighting of Makers and Takers will be done, or if it will be done at all. What do I mean?

With IDX, which I assume this idea is based on, you have some brokerages contribute huge amounts of listings while other brokerages contribute few listings (or none at all) but get to use the listings of others to do business. It is always and everywhere the case that any group of collaborators will have some who contribute more and some who contribute less. With IDX, the imbalance is blunted because those brokerages who use the listings of others to generate buyer leads eventually bring buyers to the listing, which results in increased business for the brokerage contributing the listing.

With a “technology IDX” however, that isn’t the case. Say Brokerage ABC contributes 50% of the codebase for BPP 2.0 and Brokerage XYZ contributes none at all. XYZ can still leverage all of the work that ABC has done to improve its website, its systems, its technology… while ABC gets precisely zilch from XYZ.

Unlike IDX however, nothing that XYZ will do with this new technology suite benefits ABC in the least bit. In fact, if ABC and XYZ are competitors, then that only hurts ABC.

Why would brokerages and MLSs contribute more to this technological reciprocity pool?

Question #4: National Data Reciprocity

The third pillar is a national database created by a new kind of data reciprocity:

MLS Reciprocity follows the same mantra of “you can display my listings if I can display yours.” MLSs who participate in the Broker Public Portal will have their listings displayed on the new BPP national website, and will be able to display a national dataset on their local consumer facing portals.

The goal is to have the MLS records aggregated into a national dataset, and maintained by the BPP to future-proof industry ownership. The national dataset will be used to engage consumers across the country, and connect them with local listing brokers and agents.

There are interesting details here as well, but… let’s start with the concept itself.

So this new dataset will power a new national portal to compete with Zillow, Redfin, Realtor.com and Homes.com. But it will also power a variety of local MLS websites… because consumers in Michigan often want to see listings in Oregon or New Mexico…. Am I understanding this right?

And since the national dataset will be available not only on New BPP Portal, but on potentially hundreds of local MLS websites… Google will do… what exactly? I’m not an expert on SEO so I don’t know if that helps BPP Portal or hurts it, but… it’s a question.

Wait, there’s more.

Is this data reciprocity limited to public display, or does it extend to actual MLS data? That is, does this reciprocity extend to private remarks that are normally only in the MLS itself?

If the latter, then BPP 2.0 will eliminate all of those painstaking data sharing arrangements that MLSs have spent years entering into. In fact, here’s the most recent announcement I know of — FMLS and REColorado Ink Data Share Agreement. If some tiny little MLS in northern Georgia or in western Colorado can get all of the data from FMLS and REColorado by virtue of joining BPP 2.0, I can’t imagine those two big MLSs being happy about that.

If the former, then… what? The only real difference between “MLS data” and “Display data” are those private remarks. Will participating MLS s be somehow prohibited from importing all of the display data into their local systems so their own subscribers can directly contact the listing agent for whatever information they need? How will BPP or anybody else enforce such a prohibition, especially when data cannot be copyrighted and licenses to photos must be granted if public display is the whole point of this data reciprocity?

Then we have this:

Last but not least, the national dataset will only be for use by MLSs seeking to complement broker IDX search with a “your listing your lead” search experience. Brokers will have access to listings from MLSs where they are a participant in good standing.

So this national dataset is limited to MLSs. Brokers are specifically prohibited from using the national dataset.

Which means that a large national or regional brokerage who belongs to say 30-40 MLSs must still process 30-40 IDX feeds with 30-40 local rulesets… while those 30-40 local MLSs have access to a single national dataset with (one assumes) a single national ruleset? Why would large brokerages want this exactly?

If I’m Glenn Sanford at eXp, or Ryan Schneider at Anywhere, or Robert Reffkin at Compass… why would I think this is a positive?

It’s one thing to have to deal with 30-40 IDX feeds with 30-40 rulesets when there is no national dataset with a single ruleset. It’s a whole different matter when such a dataset exists, but I and my ginormous company are locked out from using it.

Question #5: Who Sends What to Whom? Plus, Responsiveness?

Closely related are questions from this passage:

The goal is to have the MLS records aggregated into a national dataset, and maintained by the BPP to future-proof industry ownership. The national dataset will be used to engage consumers across the country, and connect them with local listing brokers and agents.

Okay, so… who is sending what to whom here?

The national BPP portal receives an inquiry from a consumer. Does the national portal send the lead to the listing agent? If so, what’s the point of the local MLS website with the national dataset on it? I guess the idea is that the local MLS website would send leads to the listing agent as well, but far fewer than the national portal (since that’s kind of the whole point and advantage of having a national portal in the first place). That in turn makes the local portal less useful and less valuable to the listing broker/agent.

Maybe the idea is that National Portal would send the lead to the Local MLS, which would then send it to the listing broker. That seems efficient, said nobody ever.

And then we have the question of whose responsibility it will be to ensure that the listing broker actually responds to the lead.

I have written thousands of words on why Zillow switched over the years from “come one, come all” to “only the best agents” to “in-house call centers.” Because they — like every real estate portal ever — had a devil of a time getting agents to respond to online leads at all. At one point, Zillow was seeing only 50% response rates to online inquiries from consumers.

With BPP 2.0 and the local MLS portals… whose responsibility will it be to ensure that an agent who is sent a lead actually responds to it in a timely fashion?

And exactly how will either BPP or the local MLS do that?

Question #6: Ongoing Funding

My understanding from industry sources is that CoStar paid a significant breakup fee when the BPP-Homesnap marriage got dissolved. I have no idea how much it was, but I assume it wasn’t all that significant since Andy Florance didn’t mention it during his latest earnings call. But let’s say it was significant in the poorly funded MLS space.

So that gets BPP 2.0 going. Fine.

Three years from now, after whatever initial hit of funding from the divorce settlement is done, how will BPP 2.0 be funded?

I mean, we’re talking some pretty large numbers here to have a competitive residential portal in 2022 and beyond. Zillow for example spent just under $100 million last year on digital, print and national TV advertising. Will BPP 2.0 do any advertising at all? If not, how exactly will it get any traffic to its website? If it will do advertising to consumers, where will that money come from?

We already know that CoStar has made residential real estate a centerpiece of its growth strategy going forward. (Read the 3Q earnings report if you haven’t already.) They’re talking hundreds of millions of dollars to compete against Zillow. BPP 2.0 isn’t even on their radar, but the spending is the spending.

That’s assuming that none of the brokers, MLSs and vendors who contribute technology take a dime; it’s all open source, and they’re contributing code and technology for free. The annual membership fees pays for staff and overhead, but… those are not likely to pay for actual development, marketing, and growth.

So where will the ongoing funding come from? Will BPP 2.0 need a business model to keep things going? If so, what might be that business model in the “Your Listing, Your Lead” kind of a world?

Question #7: Is It Time for a Name Change?

Finally, it’s probably just me but… the big push of BPP 2.0 is the creation of a national dataset of listings provided by the MLSs, whose usage is restricted to MLSs. Brokerages are specifically left out of being able to use that national dataset.

Isn’t it about time to change the name of Broker Public Portal to the MLS Public Portal?

We know from the Inman report that it was the MLSs who killed the BPP-Homesnap marriage. We can see from BPP 2.0 that the MLSs are clearly in charge. The main beneficiary of BPP 2.0 will be the participating MLSs who contribute technology, contribute data, and will be able to use the national dataset to power local MLS websites.

What’s with the gaslighting that this entity has much to do with Brokers at all?

“MPP” rolls off the tongue just as easily as “BPP” y’all. Seems like high time to cut it out with the obfuscation and change the name to MLS Public Portal.

But like I said… that’s probably just me.

So Many Questions

It should be obvious by now that I was also gaslighting when I said I have seven questions. Going back over the above, it seems more like twenty-seven questions. And I left out a bunch of other questions, like, “So this mobile app that you’ll be developing that each member can clone… will each app then be in the AppStore or Google Play Store? That’s a lot of apps that are identical and do the exact same thing.” And, since national data “will be held in trust by the BPP for the benefit of the BPP owners,” perhaps one might ask “Who are the owners of BPP today? What are their percentages? Do they get dividends? Are they subject to capital calls?”

And so on, and so forth. But let’s leave it there for today.

-rsh

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