[UPDATED 11/20/09: More facts added.]

Earlier this week, Reggie Nicolay (@ReggieRPR), the Director of Social Media for the REALTORS Property Resource, LLC, wrote:

Reggie-Death-To-Drama

I happen to agree 100%.  Also, a commenter on one of my earlier posts by the name of Kris Goodfellow wrote:

Rob,
I’ve got to say, that there is much in the way of speculation and little in the way of “facts” here. DOA, really? That’s pure conjecture. Marty got a standing O today from the 2000 leaders from every state and local associations. In the big broker’s session, the comments included “WOW!” and RPR was compared to Neil Armstrong walking on the moon.
I might be just an old fashioned, ex-newspaper journalist, but I’ve got to say that a year this post is going to look as silly as the “Dewey Defeats Truman” headline. Tell the story, man, don’t try to be a fortune teller.

So let’s say I agree with both Reggie and Kris.

My take is that you kill drama and hype by showing the facts, not by calling questions and opinions “drama and hype”.  So in the interest of moving the conversation along, and also to emphasize once again that I am no opponent of RPR, I have put together all of the facts as I know them with sources, along with questions about what we do not know.  This way, anyone who is interested might be able to discern for himself what is real and what is drama.

Known Facts About RPR

Just the facts, maam
Just the facts, ma'am

The first source for facts should be the RPR Fact Sheet (PDF), published by NAR/RPR.  My other main sources for information are: RPR Webinar of November 6, 2009 (“Webinar”); the REBarCamp San Diego session on RPR on November 12, 2009 (“REBCSD”); the presentation by Dale Ross and Marty Frame to the MLS Executives session on November 13, 2009, which largely mirrors the content of the initial webinar (“MLS Session”); and an interview with Prem Luthra, Chief Strategist for LPS Real Estate Group, on November 13, 2009 (“LPS Interview”).  If there is factual information from another source, I will note it.

So here are the Known Facts about RPR, as of today.  Please note: I am only listing the facts that are relevant to the discussion; some of the details — such as percentage of counties covered in the public records data — are left out because I don’t see them as relevant to the issues at hand.  But many of those facts are available from the sources cited above.

RPR As Technology

FACT: The RPR™ will provide a single-source national compilation of tax and assessment data; property data; neighborhood, school, demographic and psychographic information; and maps, trends and reports. It will be exclusive to members of NAR, who can share its information with their clients. (RPR Fact Sheet)

FACT: Members who register with a valid NRDS ID can access non-proprietary, non-MLS/CIE sourced data; however, only MLS/CIE Subscribers/Participants will be able to view MLS/CIE sourced information. There will be no public access to the RPR™, and the database and its data cannot be shared through consumer websites. (RPR Fact Sheet)

FACT: RPR will feature complete on/off market MLS content for all property types, including all current imagery, all historical imagery, and virtual tours. (Dale Ross, RPR Webinar)  In order to collect this data, cooperation by an MLS is necessary. (Dale Ross, MLS Session)

FACT: The RPR will not have offers of cooperation and compensation. (RPR Fact Sheet)

FACT: The RPR’s™ national demographic information, along with enhanced search capabilities, will allow a REALTOR® anywhere in the country to provide more information to their clients. The enhanced search features will allow nationwide depth of property searches, as well as market-to-market comparisons. Advanced User Profile Features and social networking components will help REALTORS® create referral communities, as well as reverse-prospect specialized property types, such as vacation and waterfront to REALTORS® throughout the U.S. (RPR Fact Sheet)

Fact: RPR will feature a Automated Valuation Model, to be called REALTOR Valuation Model, which is created by taking the existing industrial-grade AVM’s that LPS provides to lenders, financial institutions, etc. and combining on and off-market information from MLS’s for greater accuracy. (Dale Ross, Webinar)

Fact: The MLS’s (that opts-in) will get a branded version of the RPR system to integrate with their MLS system. This will allow members increased efficiency by clicking right from a listing inside the MLS and landing on a MLS branded/integrated version of the RPR. (Reggie Nicolay, Comment to my blogpost)

FACT: Customizable reports for the REALTOR: CMA, Buyer’s Tours, Property Profile, etc. all for free. (Marty Frame, Webinar)

Usage of RPR and Membership Facts

Fact: The Terms of Use for the RPR web tool is finished, but not yet public (Reggie Nicolay, REBCSD)

Fact: The sharing of RPR information does not extend to public display via website.  Members cannot take the public data and display it on a “public-facing” website.  Members can create and print out reports for clients.  (RPR Fact Sheet, LPS Interview)

Fact: There’s a wide gray area in between the two poles: display on a public-facing website is definitely prohibited, while printing out reports to show a client in person is definitely allowed.  But it is not clear, for example, whether a RPR member can put together a public-facing webpage with a PDF of all of the neighborhood information. (LPS Interview)

Fact: The agreement between LPS and RPR contains policing responsibilities on the part of RPR to ensure that members do not violate the terms of the data license between LPS and RPR.   (LPS Interview)

Fact: There will be a VOW (Virtual Office Website) API for RPR, strongly implying that members will be allowed to share RPR data with clients via a VOW (Marty Frame, MLS Session).  SEE UPDATE BELOW.

UPDATE! Fact: (Source: Michael Wurzer’s FBS Blog)

Fact: A REALTOR (i.e., a member of NAR) who is not a subscriber to the local MLS will have access to RPR.  They will not, however, be able to see the MLS data.  Conversely, A subscriber to the local MLS, who is not a member of NAR, will not have access to RPR. (Dale Ross, MLS Session)

UPDATE! Fact: No Authoritative Record.  In response to my question as to whether RPR will be establishing an authoritative record from the various sources of data (public records, MLS, loans, etc.), Marty said no.  RPR will present the various sources of data side by side but they won’t try to reconcile them. (FBS Blogpost)

RPR As A Business

Fact: RPR is a wholly owned for-profit subsidiary of NAR, incorporated as an Illinois LLC, and expects to turn a profit in year four of operations: $2mm in Year 4, $8mm in Year 5. (Dale Ross, MLS Session)

Fact: NAR has purchased “certain assets” — confirmed as the assets of Cyberhomes (REBCSD) — for $12mm from LPS (NAR Press Release, Dale Ross, MLS Session).  The codebase of the RPR software, including the underlying assets of Cyberhomes, is 100% owned by RPR. (Neil Pinchin, REBCSD)

Fact: The deal with LPS over sale of Cyberhomes assets and the creation of RPR was done over a 4 month period (Dale Ross, MLS Session)

Fact:There were seventeen (17) agreements in total, from License Agreements, Source Code Agreements, etc. (Dale Ross, MLS Session)

Fact:The partnership between LPS and NAR is via contract rather than a joint venture or other equity-based partnerhsip. (Dale Ross, MLS Session)

Fact: NAR’s total investment into RPR project is $20mm over five years, including the initial $12mm for purchase of assets. (Dale Ross, MLS Session)

Fact: The business model for RPR is to take the public data from LPS, combine it with MLS data from participating MLS’s, create derivative data products, then to sell these data products to various institutions, including government agencies such as Fannie Mae, The Federal Reserve, etc. as well as financial institutions. (Dale Ross, MLS Session)

Fact: No raw MLS data will be provided to data customers; only the derivative products will be sold. (Dale Ross, MLS Session)

Fact: RPR plans to roll out on a market-by-market basis.  For example, if California signs up with RPR, then California data will be the first to be processed by LPS/RPR. (Dale Ross, MLS Session)

Facts about the Relationship Between RPR, MLS, and LPS

Fact: LPS did not sell any assets connected to its Data Analytics Group, and no employees of the Data Analytics Group or the LPS Sales & Marketing teams went over to RPR.  Instead, LPS will partner with RPR to create the data products (via its Data Analytics Group) and to sell the data products (via its sales and marketing people).  RPR does not today have any staff that does either Data Analytics/Productization or Data Sales & Marketing. (LPS Interview)

Fact: LPS granted RPR a “fairly broad set of rights” over the public information data it is providing to RPR. (LPS Interview)

Fact: While LPS is totally committed to the success of RPR, and to the partnership, LPS is not prohibited from doing business directly with an MLS, should an MLS opt-out of working with RPR.  (LPS Interview)

Fact: RPR is not exclusive with LPS; RPR’s license with a participating MLS is also not exclusive (Dale Ross, MLS Session).

Fact: According to the Q3, 2009 earnings report for LPS, the “Technology, Data and Analytics” segment generated $186.3mm in revenues.  Of that, $103.0mm was from mortgage processing, and the rest — $83.3mm — was due to “strong growth in Data and Analytics Services” (LPS Q3, 2009 Earnings Report)

Fact: LPS Real Estate Group will create data products and sell them to the real estate vertical. (LPS Interview)

Fact: Revenues from RPR derivative products to government/financial institutions will be split 50/50 between LPS and RPR (Dale Ross, MLS Session); revenue share from sales to real estate organizations/companies/agents between LPS REG and RPR is not yet determined.

Fact: There will be no revenue share with a participating MLS or with a participating brokerage. (Dale Ross, MLS Session) However, RPR estimates that the value of the free public information via RPR, as well as the RPR user interface software, will save MLS’s from between $25mm and $30mm per year. (Dale Ross, Webinar)

Let Us Kill The Drama Dead!

While I think I may be leaving out some key facts, I’ve listed all of the ones I know of today.  The questions are mine and mine alone, although others who have been and are participating in the conversation might have more of their own.

I wanted to do this because I’m really not that interested in drama or hype; I am interested in the truth and additional facts about such an important initiative.  If there is an “atmosphere of fear”, then by all means, let us dispel it so that meaningful conversations and debate can take place.

As I’ve said time and time again, I am a fan of the RPR software — it is a brilliant piece of software engineering.  The people behind it are some of the most impressive talents we have in the industry.  I find some of the business arrangements and relationships befuddling, and I stand by the statement that the incentives for all of the various players do not appear to be in full alignment.  But those are based on the known facts.  I am entitled to my own opinion, but I am not entitled to my own facts — no one is.

The first step, then, in clearing the air of all drama, hype, fear and suspicion is to understand all of the facts.  I have started it; I hope those who are more knowledgeable, who are in possession of the real facts, would take the time to answer questions, dispel myths, and reveal the facts that the real estate community needs to know in order to form their own opinions on the issue.

Thanks,

-rsh

10 Responses

  1. Rob, This is a great basis for continuing the RPR conversation between the various stakeholder groups. I for one will encourage RPR leadership to confirm your statements of Fact and respond directly to your excellent questions. Keep up the good work!

  2. Rob, this is a terrific summary and a nice change from some of the more rampant speculation we've read. I suggest taking even the 'facts' here with a grain of salt, though. Until RPR delivers a service and a contract for MLSs and brokers to sign, I expect its model to continue to flux, and many of the facts could flux with it.

  3. Rob thanks for all the great questions.I have some morning meetings and will get to this thread later today. So you know the last few days I've been working on our RPR blog with @Pinchin and it will be up soon. We will have a FAQ section that handles most of these.

  4. Great job summing things up, Rob! It's great to see everything laid out. I'm looking forward to seeing how all this flushes out as the answers are developed. IMO, if the convention was a month or 2 later there would have been a lot more answers. I think NAR could not go to another convention without having a big statement about RPR.

  5. Rob- great summary of the facts- Kudos! However the point that:

    “Members who register with a valid NRDS ID can access non-proprietary, non-MLS/CIE sourced data; however, only MLS/CIE Subscribers/Participants will be able to view MLS/CIE sourced information. There will be no public access to the RPR™,”

    ….is extremely naive. I personally know a dozen REALTORS that hand out their access to http://www.realtor.org all day long. I don't see entering a NERDS number as being any type of barrier to the public access to the RPR data and RVMs. I encourage everyone involved to consider the serious security issues if the data is truly meant to be kept behind a curtain… and begin constructing a real security implementation.

    Keep up the good work!

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