On occasion, there is a surge of commentary on a particular topic presented as a post on Matrix that seems to warrant some additional followup. I often learned a lot from these comments as they seem to push the discussion a little deeper.
The word [Vortex](http://dictionary.reference.com/browse/vortex) or _something regarded as drawing into its powerful current everything that surrounds it_ came to mind as a way to describe this sort of feedback about a particular topic. Hence, Matrix Vortex.
Topic: Zillow.com and Realtor.com
Post: [Zillow Gets Pillowed In Old School Smackdown [Matrix]](http://matrix.millersamuelv2.wpenginepowered.com/?p=924)
One of the most incendiary topics of late has been anything that has included the word “Zillow” in it when the topic concerns brokers.
Last week the post [Zillow Gets Pillowed In Old School Smackdown](http://matrix.millersamuelv2.wpenginepowered.com/?p=924) stirred up a _Vortex_ of discussion, ranging from pro-Realtor.com to pro-Zillow.com. A lot of passion was provided in the commentary.
A few days after his appearance on the CAR panel, Allan Dalton, the president and CEO of Realtor.com, [was promoted to president of the Move, Inc. Real Estate Division [RISMedia]](http://www.rismedia.com/index.php/article/articleview/16389/1/1/). Honestly, I was surprised by his photo in the RISMedia story. I had pictured him as being a lot older than his _old school_ commentary suggested and perhaps he represents the current mindset within NAR. He seems to be one of the rising stars of NAR and wouldn’t be surprised if he eventually becomes its president. His aggressive, take no prisoners style may be what NAR is favoring these days as they are being attacked on all sides, including the Department of Justice lawsuit.
At the same time, the Lloyd Frink, president of Zillow, posted a politically correct [recap of his experience at the California Association of Realtors](http://www.zillowblog.com/zillow_blog/2006/10/zillow_at_car.html) conference (which was personally disappointing to me for its blandness, specifically, the heated panel discussion with Allan Dalton). What I found particularly interesting was the fact that he didn’t mention the attack by Dalton at all. Frink also backpeddled from his past experience with Expedia suggesting that the Realtor is essential to the process, unlike travel agents, which is what Expedia rendered nearly obsolete. It seems like only now Zillow is realizing how important Realtors are to their long term strategy or they underestimated the backlash.
The irony here is that [Realtor.com](http://www.realtor.com) is a cluttered, crowded web experience and [Zillow.com](http://www.zillow.com) doesn’t include listings. Why so much friction? Can’t they ever get along or is it too late?
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Until a major real estate franchise advertises there, and others follow, can zillow.com survive on the ad dollars it is getting? I’m no economist, but this may not be sustainable for a real estate content website.
Jonathan, so when can we see the 3Q Elliman report? I’ve been waiting patiently for a couple weeks now.
Think about it this way:
In the stock market, you can go to bear-stearns and pay hundreds of dollars per trade, and you get access to all of their research, opinions and expertise.
Or, you can go to scottrade, pay $7 per trade and do it all yourself.
There is room in the market for both, but the weaker hands will be forced out.
As for “can they make it without additional advertising”… These internet-only presence sites are obscenely cheap to run, look at craigslist as an example.
Joe –
“These internet-only presence sites are obscenely cheap to run, look at craigslist as an example.”
True. However, craigslist is an anomoly that was started back in 1996 or so and really powered ahead in 1999; before social networking took root. Zillow has tens of millions of venture capital funding in it paying for development, software, and human resources. I would expect someone to want to make a tidy profit.
Whats the exit strategy? It seems that zillow is persistent on licensing their content via an API to much larger trafficked sites like Yahoo, or MSN. If they suceed and integrate an optimal ad platform into this API system, they might have the umph they need to sell out or be acquired.
I do not think their business model alone will make this money back. I think there is an exit strategy being planned by the backers of this fluff site.
Zillow might make it but they could have spent far fewer dollars to get the same audience. Therein might be their problem. Their plan would be great if they only spent $3 million vs. upwards of $25 million with a $55 million + raise. The difference isn’t a delta in achievement but of credibility. I hope they make it. From my vantage point, I think they have a descent chance yet but I would be laser focused and penny pinching if I were them. Panic or trying other things for quicker results for their investors benefit at this time would be a critical error. Time will soon tell if I would want t to be in a fox hole with thier leadership. For them it would be not a race to spend VC dollars but to conserve them because patient persistence will bear their model out – not speed as many might think.