Zillow has worked with ListHub for years to access listings from brokers, MLSs and agents. But this agreement changes a few things. Zillow will now be sending detailed analytics on views back to ListHub customers. They will also be prevented from re-syndicating the listings and cannot use the data they get from ListHub for non-display uses (e.g., in a Zestimate calculation) without advance permission from the listing source.
But that’s not really the story. This new agreement means that Zillow has effectively committed to a lengthy partnership with one of its chief rivals.
That’s the story. Two quick thoughts:
First, it seems to validate Move’s play on ListHub – at least in the short-term. They control a biglistings pipe and that has given them leverage. My sense is they don’t intend to be too muscular in handling their new asset but leverage, even implied, is seldom a bad thing.
Second, it underscores just how much Zillow must have needed to maintain the ListHub relationship, which they rely on for over two million listings. In its S-1, filed earlier this week, the company acknowledged the following risk:
Many of our agreements with real estate listing providers are short-term agreements that may be terminated with limited notice. The loss of some of our existing relationships with listing providers, whether due to termination of agreements or otherwise, or an inability to continue to add new listing providers, may cause our listing data to omit information important to users of our products and services.
This deal mitigates that risk by locking up a lot of listings for a long time. It also allows them to ride Move’s coattails a bit on listings quality, something Move is uniquely positioned to lead on and with which Zillow has struggled for years.
So, sounds like a pretty good deal for Zillow. But what does Move get out of this?
That is less clear right now, but potentially more interesting. I’m not going to overdo the speculation here, but just remember that this deal takes place during a time when the industry seems to be wringing its collective hands over the notion – which solidified into conventional wisdom about three years ago – that syndication is a no-brainer.
Brokers and brands that partied all night in the Hotel Syndication are now waking up to a mess. Move is housekeeping. Believe it or not, that’s good for Move.
Beyond the freak-out
When Move bought ListHub, they effectively gained control of their competitors’ largest source of listings as well as the reports brokers, MLSs and agents see when they judge the effectiveness of syndicating listings to one site or another.
When this happened, Trulia freaked out; Zillow played it cool. And Move assured everyone they’d play nice, maintaining feeds to competitors and reporting numbers back to the sources of the listings in an impartial manner.
It was unclear how it would all play out.
Now we know – at least with Zillow.
Update: Luke Glass, ListHub’s GM, emailed me to note that Zillow will in fact be able to use the listings data to calculate Zestimates and the Zindex, their aggregate measure of market activity. Other derivative uses will be prohibited.
[Disclosure: Move, Inc. is a 1000watt Consulting client]