As for another ‘dreamer’ Ron Walker is trying to paint his tenure at Fairfax as a savior telling ABC PM, “If we had continued to rely on the cash flows from the Sydney Morning Herald, the Age and the Financial Review, the company wouldn’t have existed today, so, it’s paid off for us”. Yes Ron, paying $700 plus million for a ‘New Zealand only’ classifieds site saved Fairfax! Fairfax has some great opportunities but the window is closing very fast and buying up expensive digital assets that do not even cover the interest on the loan to buy that same asset is not the answer. I have no idea what Ron Walker has done in his time on the Fairfax board, but I can assure you he will not be remembered as a savior!

It truly dumbfounds me how large organisations such as Telstra, Fairfax, PBL or News Limited rarely ever create a unique product from scratch. They are all very good at buying assets at the height of the market and selling or getting out at the bottom of the market. These companies already have huge traffic to their major sites and massive databases in the classifieds arena, be it in cars, jobs, houses or general classifieds., so it should be relatively easy for them to create successful new products and increase shareholder value.

They need to get out of the habit of buying up websites for 100′s of millions of dollars and invest a few million each year in a ‘Black Ops’ style tech team to come up with new and exciting products from existing databases/systems they have.

This team should be able to tap into (read) any database and should be able to create new products from scratch without someone telling them ‘no you cannot do that, this will affect this or that’. The idea is that you create new products and test them in markets across your digital assets. This team should be able to go and meet with any division of the organisation and be granted access to any data. Yes, you must have some oversight, but that is at the end of the process, not at the beginning – if a product doesn’t fit – or is too risky – it gets shelved.

The alternative is to continue dying a slow death and live in denial. There does come a time when banks will abandon these companies or their money will run  out and for some of them the only way to survive will be to do what Telstra is doing and selling off or closing down assets.

This is the digital era and web/mobile based products will be everything to these companies in less than 10 years.

Well what a year it has been, with just about every major company in the real estate and classifieds market vying for entry into this years awards.

So how do you make our dumb and dumber awards? Well quite simply, you make a schoolboy mistake, try to cover something up or worse still knowingly do something that is so obviously dumb to everyone else aside from your inner sanctum.

So here is our list for this year, enjoy!

1. WINNER – REA Group – Realestate.com.au

What do you do when one of your email servers have hundred’s of thousands’s of property email enquiries stuck and not delivered for months and months on end to real estate agents battling through tough times? Well for starters some bright spark decided we will just deliver them to agents who had no clue of the age of the emails! Once the story broke here on business2.com.au REA then went into damage control and placed a note in agent admin and then later sent out an email explaining the situation to unsuspecting agents. This left agents embarrassed – their reputations tarnished and having to apologise to ten’s of thousand’s of enquirers.

REA offered a heartfelt apology, discussed compensation, but decided to just weather the storm and continue business as usual. REA’s reputation for care has never been worse and will take a hell of a lot of work to win back agents trust. More price rises to come will not help their cause. Fluffy promotional emails will not do anything either, hard work, improved customer service and some humility will help.

2. RUNNER UP – PBL & Microsoft

Get a photo op with a bunch of Steve Jobs wannabes on launch, spend ten’s of millions of dollars marketing a website with out-of-date and sold listings, less than 30% of your rivals listings (and the same data), do buddy deals with a handful of the major franchise groups along with the worst real estate interface to come out of the 21st century and what do you get? Well you get them running scared and selling it off in 12 months for less than 3% of what they put into it. Still it has to be one of his better deals since he took over from daddy. If you want to know how NOT to build and launch a real estate portal, note the myhome.com.au debacle. The new owners are trying their best and have really got back to basics. May be worth the try now!

3. Major Telcos

Put together pathetic customers service, disgraceful data plans, slow networks and you have yourself a major Telco. Telstra may have the best wireless Internet in Australia, but it has the most expensive – restrictive plans around and Optus is not much better. It pays big time to look around. Maybe Telstra should spend some time and money on the people that make them money rather than trying to protect their monopoly. Optus does not fare much better and you only have to look into the Whirpool forums to see how many people loath their Telcos.

4. The Financial Meltdown

Oh, how we were once impressed by our finance market friends driving their Maserati’s and Porsches, how we listened to their amazing insights into how the money markets worked, how impressed we were about how they speculate and how their models make everyone rich and successful. Turns out they were all pretty much clueless, having fancy degrees on a wall means nothing if you don’t have real world smarts. If making money is your only goal then you will eventually fail, problem is – this time around everyone suffered.

It is ok to strive for an open market economy, but should mum and dads around the world have to bail them out when it all goes pear-shaped?

5. Get it ‘FREE’ Mobile Domain

SMS property alerts on your mobile, great idea and absolutely free – well free as in 0.55 cents an SMS. Ooops sorry forgot to mention that! ACCC noted this and slapped Fairfax over the knuckles.

6. REA’s Peak Industry Body

Way way back in March 2007 (nearly 2 years ago, REA setup ‘The Peak Industry Body’, this was no doubt an effort to ‘connect’ with you, ‘Joe the Plumber’, meeting ‘at least’ 6 times a year would equate to around 24 meetings so far. I think each meeting ended with a Hollowmen ‘steady as she goes approach’ because unless I am mistaken nothing has ever come out of this – except continual price rises

7. Internet Explorer

To every single software/website or so called IT expert that only works in Internet Explorer or in the latter case only only allows you to use IE6, hang your heads in shame. Every time I use Internet Explorer I am frustrated, whether it is testing sites in IE6 or 7 and now IE8.

The latest debacle for Internet Explorer came just a few days ago.

The vulnerability could allow remote code execution if a user views a specially crafted Web page using Internet Explorer. Users whose accounts are configured to have fewer user rights on the system could be less impacted than users who operate with administrative user rights. This security update is rated Critical for Internet Explorer 5.01, Internet Explorer 6, Internet Explorer 6 Service Pack 1, and Internet Explorer 7.

Basically anyone could access your PC and take anything they liked. Microsoft stated that it is always looking at ways to improve their product, no, they are always looking at ways to get it to at least work. One friend of mine lost $4,800 just yesterday and is scrambling to get it back because someone hacked their PC.

So free yourself from the train wreck of a browser which is Internet Explorer and jump with Firefox, Opera, Safari or Google Chrome and leave, buggy, slow, insecure software behind. If your software provider can’t cut it, then leave them behind as well.

Note: Also read some reviews on anti virus software and get it installed on all pc’s.

8. Why are we waiting?

Google needs to get its act together and release a solution that the whole market is waiting for. Every day I am asked the question and each day I have no answer. I know they are working on it – but come on guys and girls. Worldwide the advertisers market for a stand-alone real estate website from Google would be worth billions and billions of dollars of new advertising revenue.

9. Yellow Pages

Time to get a new advertising campaign, no one really cares about you any more and the campaigns warning us of impending financial gloom if we do not advertise with you just don’t cut it any more. Rising costs, hundreds of thousands of books dumped in rubbish bins or left rotting in the rain – and a business model that just plain sucks. And don’t get me started on Yellow Pages Online.

10. Newspapers

I love newspapers, I really do, they serve a great part of discussion in our community, but if you think articles about Nicole Kidman’s lips or Brad and Angelina are going to lift your readership think again. Newspapers need to rebuild their classifieds to suit a new market. Once upon a time agents pushed newspaper advertising for them, only a few do now and the market is getting smaller by the day. Keep this up and classified newspapers are finished. Simple test, get two people, one in a newspaper and one online to find a 3 bedroom 2 bathroom property in Wagga Wagga.

Solution?
1. Rebuild your classifieds for ease of use.
2. Offer annual subscriptions at a loss to build base readership – $10.
3. Get into real property journalism that gets people talking. (not paid for fluff promos)

11. New Real Estate Portals

So you want to help agents get away from REA and Domain? No you don’t, you want to make money and sell out to one or the other once you have some success. Oh and $10,000 you have committed does not build you a national portal – not even built off shore. So, stop telling me you care and how exciting your product is and do the hard yards, start local and build out, and your systems had better be good!

12. Kevin Rudd

Oh Kevin you had us all, you promised so much, you work long hours and impress us with grandiose words like ‘education revolution’. Here’s the thing, deep down inside you know you are boring, we do too, but we knew that already, we just want you to make a difference, we want some bold initiatives – not only for this industry but for Australia. In 2009 there is to be no more buck passing, no more ‘we are not immune’.

We didn’t know what cards you had, we thought it must have been good, 3 deuces in the hand? A straight? A full house? A flush? A straight flush? If we find out all you had was a piddly small pair – you will be out with the bathwater. So get down and dirty, make some bold reforms and get this country back on track.

13. Printed Local Property Guides

Every week about 24 local newspapers are dumped on our doorstep (we only have 12 apartments) and every week about 23 of them end up in the trash. You all thought it was a great idea to launch a property guide. How wrong it has all turned out to be. I will give you all less than 12 months. When vendors clearly say no to agents about advertising in local newspapers you know you are in trouble, my bet is that you will keep thinking you can turn it around.

14. Agent Websites

I spent a day trawling through agent websites randomly a few days ago. I looked at over 500 sites. Ouch, apart from seeing about 100 websites that are exactly the same (template sites), so many do not work in all major browsers. Here is a hint, if newspapers are no longer viable in this climate for marketing, where is your differentiator? Yes its your website! If you have a good one, then let every vendor know about it and ask them to compare. If you don’t – then you only have yourself to blame.

15. Vanity Blogging

Everyone is getting into blogging and you should be too. However steer clear of chest thumping and telling everyone how wonderful you and your company are – because no one is listening. Write about what you know and your opinions on the market, promote local businesses and get everyone involved. Welcome dissent, as long as it is not abusive or profane – promote it.

16. Vanity Boards

If agents need a pointer as to why some people think sign boards at the front of homes for sale and rent are more about the promoting real estate agents than the properties they are promoting then look no further than those ‘look at me boards’ promoting massive pictures of agents and in most cases nothing about the property. Ok, we get it, you absolutely love yourselves and it is cheaper than billboards but just let it go, the will to want to do it, should be enough of a sign that you have lost the plot.

17. Channels 7, 9,10

So you have your own little ratings system which bears no semblance to actual figures (good to keep that ad revenue coming in) however you are all finished unless you adapt. Showing old series just doesn’t cut it (a lot of people download the new series anyway), blatant chest thumping is so 1980′s and no innovation means a slow grinding death. Think about digital, get together, innovate with set top boxes supported by all and create a new market for direct localisation of ad serving.

18. Advertising Agencies

If you want to know who NOT to listen to when it comes to marketing your products or services just look at advertising agencies. I had a taste of them in the late 90′s and thought I would go through the process again, hoping they had learnt something about the Internet since then. I am not going to name the agencies, but if the group I met are any indication, stay well away, save your money and do it yourself!

19. James Packer

James oh James, what a business you inherited, tv networks, magazines, prime Internet locations, casinos and the list goes on. Here’s an idea, lets build a business our family empire will be proud of, lets dump just about everything we have built over the years and just get into gambling. What a noble business to be in and what a time to do it? We never cared to much about how rich you were, we liked Kerry, he was like one of us, we loved his stories (even if they were myths) and we liked you. If all you want to do is make money – then good luck to you – but you only have a few billion left buddy!

20. Mobile Agents Angst

So you have a local competitor that does not have an office (road warrior) – get over it. This is the 21st century and mobile agents working from home or on the road are going to be a lot more common over the coming years. If you use your office as a springboard to connect with vendors and buyers then you have nothing to worry about.

21. Real Estate Institutes

Can someone tell me what these organisations actually do?

A Merry Christmas and a Happy New Year to all of our readers, see you all again in 2009!

MyHome now will become a free listing website, although whether this is short term or long term I am not sure. It seems that Mr Dale has done quite nicely out of this deal, pocketing a good deal of $millions from the initial transaction and then buying it back later for a fraction of the price.

I do wish Shane all of the best with this new venture, it will not be easy, but now they can concentrate on actually making this site a worthy competitor. Time will surely tell us, if this will be the case.

Below is the contents of the letter sent to agencies across Australia
“We would like to advise you that myhome portal is still functioning perfectly as before. There has been a change of ownership of myhome, Shane Dale is the new sole owner of the assets of myhome.com.au and surroundpix businesses.

Regards,
The new MyHome team. “

Every year since 2004 I have been adding my own dumb and dumber awards. Usually is it a hard slog getting so many out the door, but why was 2007 different? Anyway sit back and have a giggle at some of the dumbest moments in real estate and technology for 2007.

PBL & MICROSOFT
1. It was without doubt the most anticipated launch of 2007 and is without doubt the worst major real estate website in Australasian history. I still cringe when looking at it. How could two major companies, Ninemsn and Microsoft get something so drastically wrong? Agents found themselves subscribed to a site they had never subscribed to, with listings sold years earlier. Agents also found that agents who no longer worked at their agency were listed alongside listings no longer under their agencies control.

2. MyHome struck a cord with only themselves and thus will fade further into oblivion in 2008 unless someone steps in and makes some radical changes. MyHome incorrectly perceived themselves as pretty cool. The standout memory for me was Senior Management in the Applesque (Steve Jobs) photo pose splashed in newspapers across the land. Soon, after all senior management had gone, the site tried in vain to claw back some respectability.

3. What do you do when you have a website with only 30% of your competitors’ listings and exactly the same data within that small percentage? What do you do when statistical data tells you that people stay on your website for less time than it takes to boil a kettle? It seems MyHome’s idea was to spend millions of dollars just telling everyone about it. When will it run out? Well, as soon as the people paying the bills ask one very simple question “What are we getting in return for our money?”

TELSTRA
1. Has any one company spat the dummy so many times in the past 12 months? Good ol Sol knows a good monopoly when he has one and will do anything to maintain the status quo. Many developed Nations have real broadband and laugh at us whilst we still pay ‘line rental’ and have local and national call rates, we will continue to be held to ransom by Telstra until there is real competition. Telstra have tried in vein to make the public warm to them, however the majority of Australians have an immense dislike of the company after many years of being dictated to and so are eager to move on to other offerings such as Naked DSL . (No need for telephone lines here and free local and national phone calls including broadband for one monthly fee.)

2008 will be an absolute shocker for Telstra unless it can get what it wants.

FAIRFAX DIGITAL
1. Fairfax Digital are one of the most progressive technology companies in Australia. However even big boys forget to pay their bills. One overzealous accounts department person from Web Central decided to suspend the domain name www.commercialrealestate.com.au for non payment of an $88.00 invoice. The site was down for a number of days. Of course News Ltd Newspapers made the pain last longer with many articles on this most basic of blunders.

2. Websites go down, but Domain seems to be down more and more. The reason? Who knows, from my experience it comes down to too many developments slapped on top of other projects until something simple fails and brings the whole deck down. Let’s hope it is all behind them as it makes no difference to agents invoices and only costs them potential business.

3. Adore may have had a big launch and may have had some enthusiastic backers. However, it was just another website for chest thumpers and has been slowly whittled away to nothing more than an expensive exercise. Another example of an executives idea of making more money out of agents. If the data is the same that is on a main website with all the listings then consumers will simply not bother, no matter how pretty it is.

SENSIS
1. Justlisted.com.au noted as one of the worst real estate sites ever in Australia’s big business history went for a revamp early in the year. A notice was sent out that they would be closing over the New Year and performing maintenance on their website. Some 14 days later the website was up again resplendent with all of the changes you would expect from such a significant outage– Absolutely Zero.

2. Many wondered what the hell the people at Sensis were thinking when they built a website with, well, exactly the same information as that which is on Domain.com.au. Granted it is a nice little idea, but can someone tell me why I would visit a site to search for listings which just sends me to another website to view those listings when I could have just gone to the destination site in the first place?

3. Maybe they were scared because big boy PBL got it wrong, maybe they thought it was just too hard, but by giving up on Real Estate, Sensis has become a lightweight of the Internet. With so many other web based services that are successful you would think a slow building national real estate portal would be a feather in their cap. Instead we have – well I am still not sure what we have with Just Listed.

4. I still wonder why agents spend so much money on massive ads in the Yellow Pages, I really do not know anyone who uses the print directory any more. I am sure their are hundreds of thousands who still do, but the Yellow Pages print version is destined for oblivion. Well, I thought that was the case, until a Yellow Pages executive posted a comment to my article on business2 touting that the directory was responsible for $61 Billion worth of sales to advertisers in capital cities alone! Now that is around 1/20th of our GDP. If this was the case the directory would be filled to the brim with advertisers and would need to be delivered by forklift. Of course it was internal research. So how is this done? Well just grab a calculator and multiply heaps of numbers by heaps of numbers by heaps of numbers—Easy hey!

FEDERAL STATE & LOCAL GOVERNMENTS
1. As everyone tries to find a way to get first home buyers into the market, not one government, local, state or federal have put forward one initiative that will actually make a difference. Whilst we have governments either too scared to act or too dumb to know that the crisis will grow worse year by year until a time when agents will be selling properties only to the 20% of Australians who will be able to afford them and renting real estate to the rest.

2. Thanks to the relaxing of media ownership laws we now have the competition we all dreamed of, more newspapers, television stations, radio broadcasters and lower advertising rates. Wait….no we don’t! The big boys just keep buying up other big-but-not-so-big boys.

REA AUSTRALIA
1. Around this time last year many sites starting touting the benefits of mapping and a few sites added mapping or were about to hit the horizon with mapping solutions. The CEO of Real Estate.com.au Simon Baker was having none of this, so he quickly tried to discredit mapping (to a degree) by referring to some research completed in the USA which stated that “that 88% of respondents wanted multiple pictures and slide shows, 86% wanted virtual tours, and 84% wanted neighbourhood profiles. However only 43% indicated they wanted maps and directions and only 24% cared about online mortgages‘ thereby telling us that people did not want mapping and how this research aligned with REA’s own research. Result? REA added mapping solutions and now tout the benefits of their own mapping system over their competitors. REA took an each way bet and continued with the Google Maps and is now one of the largest mapping sites in the world, their own mapping systems have taken a back-seat to the Google Maps platform.

PETER RICCI
1. April 1st 2007. Google buys REA! One of the bloggers decided to spend a little time and create a page with a press release that Google had purchased REA. I tried to call someone from REA but did not get a response. So I did what any hacker journalist would do and put up a press release and waited. It didn’t take long before I was banged to right and forced to eat humble pie, much to the delight of many.

I even received a few direct emails telling me that I got what I deserved and that I should take a course in journalism to understand the checks and balances that these journalists go through for each story they publish and how bloggers were a blight on ‘journalistic integrity’. I ate my humble pie but kept those emails just for laughs, as I love how seriously some people take themselves!

REALSEARCH
1. Real Search, yes another ‘Google of Real Estate’ – decided to launch a site and promptly sent press releases everywhere and anywhere. The site basically mined other websites for property data and presented it without the authorisation of the sites it was mining. Result? Companies started sending legal notices from everywhere and anywhere and the site was taken down within days.

Real Search has now re-invented itself and wants to hug all independent real estate agencies and help them to play on a level playing field with franchises. Funny, I thought many well run independents actually did better than franchises. We now have a countdown for launch which I am sure has changed a couple of times and around three agents across Australia are closely monitoring.

HOME PRICING WEBSITES
1. I takes me hat off to all of those house pricing websites advertising on major real estate portals. These companies basically ‘help’ people by sending their details to any agent who is willing to pay money for their information. Heaven help us if any one of these sites becomes massively popular (which they will not, especially with this business model) as agents will eventually pay through the nose for these so called ‘leads’.

The day will come when we can rid ourselves of these junk sites and concentrate on real information and real benefits for real estate agents. I am sure the real estate portals are working on their own solutions but don’t hold your breath as I am also sure that they will have some pretty juicy pricing models for themselves.

NEW REAL ESTATE PORTALS
1. This is a collective award to all of the new ‘Google of Real Estate’ portals that launched in 2007, the result being that none of them have made a difference. One day someone will release a portal, get it right and slowly build a market share without spending any money telling people about it until they get that market share. Out of all the new sites, only MyHome has a chance at this stage but they will need a brain transplant if they are ever to challenge the big boys.

These real estate portals need to go back to school or concentrate on specific areas of real estate, such as land or waterfront listings. We need something fresh and we need something that all real estate agents will embrace. Free is not free if it requires work from agents or their developers. Cheap means absolutely zero if agents do not get genuine leads.

PROPERTY GUIDES – MAGAZINES
1. Yes some of these are gorgeous to look at, but a day will come when agents say, what are we spending our money on and where are we getting a return? The result is we have more and more magazines sitting on the streets, outside empty shops and more often than not, quickly ending up in rubbish bins.

Yes, there is a place for property guides, but these companies are going to face some big hurdles in the future if they continually just dump magazines on lawns, on top of letter boxes or deliver (in my case) double the amount of guides for the number of apartments. Agents more than ever understand that these are just marketing guides for their companies and really do not do much to sell properties.

VANITY YARD SIGNS
1. A message to all of those agents who charge vendors for yard signs and then place a life-size picture of themselves on that sign with very little real property information. Clever? Maybe, but I for one would ask one very simple question.

Am I paying for you to promote yourself or for you to promote my property? Vanity signage is becoming more and more commonplace. Having a sign that tells me “I will love this place” with a big picture of a smiling person and a whopping big logo may be cheaper to produce but they do nothing for the vendor.

I pine for the good old days where a sign told me how many bedrooms, livingrooms, bathrooms, car spaces and so on and gave me a little insight into what was actually on offer and I am sure many other buyers and potential tenants do also.

TV NETWORKS
1. Oh how the Internet is hurting advertising revenues! We now have every TV network advertising business luminaries such as Gerry Harvey and John Simmons with their ThinkTV campaigns. Yes TV is still powerful (albeit shrinking). They even have their very own model of ratings (just use that calculator again) and about 3% of Australian businesses that can afford to advertise on TV!

TV is on the decline and will not be able to survive in the long term unless it gives the consumer what they want, when they want it. The only hope I see is the streaming medium whereby businesses can have their TV ads appear in certain regions for a massively reduced price. But while eyeballs are moving onto the Internet and mobile phones, if all the TV networks can do is try to hold the fort – they will die a very slow death.

NEWSPAPERS
1. Get your DVD, CD’s, Magazines and Souvenir editions with any newspaper! Read about Jennifer, Brad, Brittany, Kylie and any celebrity scandal you can think of (just get a photo and make up a story). Try as they might to grab some ‘Generation Me’ they continue to fail, despite trying really, really hard. Perhaps keeping the loyal readers might be an idea for long term survival.

Newspapers need to do what they do best and that is pure journalism instead of trumped up headlines and smut peddling (we can get that elsewhere thanks). They have made some great inroads online and I am sure they have a few years left until of course they have to bite the bullet and become FREE!

CORPSES
Here we have a bank that really knows how to sell! Firstly they repossess a home and then put it on the market for auction. Now this is one feature the new owners definitely did not pay for – a complete mummified corpse of its former owner, who had stopped making mortgage payments six years earlier.

Apparently the body, was preserved by the salty air in the Spanish seaside town of Roses and was found by, you guessed it – the buyer!

More Fun 2007 Dumb and Dumber Lists
Fortune Magazine 101 Dumbest Moments in Business
Business2 (USA) 101 Dumbest Moments
Daily News 50 Dumbest People in Hollywood

What does it mean for Australia? Well nothing much in the short term but they might ask the Immobilien development and marketing team if they could help with the embattled MyHome.

I must say bI do like these deals – any time an Australian company (consortium) invests overseas, such as what REA have done over the past years shows that we too can play instead of build and sell. As for MyHome, I really do hope they can get their act together as the Australian real estate market really does need some competition.

So here is my breakdown:
Number One – REA: Love them or loath them, they are the kings of real estate in Australia, they know the market better than any of the other portals and have done very well with this knowledge since the early days of ‘sponsoring’ Institutes to back and co-market their products directly to agents through seminars and promotions. The site has a wealth of information and has so many more listings and visitors than their nearest competitor Domain. They have been able to continually raise their agent fees year on year by an average of 8-10% and will continue to do so until agents pull them back a little or the gap between Domain and REA closes.

New Revenues: Obviously overseas expansion is going to give their shareholders some joy. Also getting smarter with their advertisers and allowing smaller players to advertise in local areas will give them a boost. They will continue to raise fees for agents whilst they can. They also acquired HubOnline to do more web development and hosting and have just released a new version with the Clarke system (another acquisition) integrated. I personally think this could cause a few more problems as more and more agents become a little uneasy about having everything under one provider. If successful it could bring a reasonably large increase in revenues and I can see why they made this acquisition. The deal with RP Data ends soon as well and I don’t think they will renew this partnership and will more than likely sell agents sales data themselves – instead of passing on the data, which will create another revenue stream.

Problems: The site is tired and old and the amount of advertising and the way it is pushed into consumer faces is getting out of hand. I also think it is going to be harder to push further fee increases onto agencies in what are tougher times and with a Federal Election looming with more uncertainties they will have to be creative to keep their shareholders happy. This will be tough as any change to the site has to go through so many departments to keep too many parties happy and this will be their toughest challenge.

Challenges: I think they will have to take control of who advertises where, to have any hope of competing in the long term. Traditionally slow moving companies falter fast on the Internet and if they cannot change, the years ahead could get tougher with big new entrants a certainty long term.

Number Two – Domain: Fairfax has been the surprise for me over the past 6 months. I spent two years wondering what the hell they were doing and it turns out they were doing nothing. However a new team took the reigns (well partly) and it seems to me they have some good strategies going forward. Their newspapers will continually take hits and losses but their online arm will see some great improvements over the next 12 months with the acquisition of Rural Press and I would expect to at least see a 30% improvement in visitor numbers. The site is far from perfect and I must say I preferred the old one to look at, but the new site does have many more functions and some that I use everyday.

New Revenues: Obviously with the Rural Press acquisition this will give a boost in many regional areas. The Melbourne and Sydney Newspapers will give them strength in these areas. However, apart from this revenue, growth will be slow. They still are second to REA in so many regions of Australia and in my opinion the only way they will reach REA is to be better value and perhaps finally – to be taken over by a PBL or another major player – perhaps an International player..

Problems: Being owned by a newspaper is a problem in itself. The big old newspapers just like making money and dislike giving anything away cheap or free. The cost to enter markets where they have no newspapers is a big problem for Domain, having digital newspapers is a good start but they need to make sure that they invest heavily in this area to make any inroads.

Challenges: They have to get more agents on board. With agents comes listings and with listings comes consumers, they have the site, but they trail REA by way to much and this is mainly due to being completely inactive for many years. Another problem is MyHome. In my opinion the only one who will lose short term, is Domain. REA have the visitors and the listings, so any inroads in the short to medium term will not come at their expense. Domain need to get into any market they currently struggle in and get into it in a big way, offering incentives for agents to join and not just 3 months free (or $50 per month) but 12 – 18 months. Once they give them the results then they charge them and agents will be happy to pay.

Number Three – MyHome: You may wonder why I even bothered putting them in here. Well PBL and Microsoft is the only reason. They should be ashamed by what they released. I am sick and tired of big companies jumping into new Internet markets with little to no thought except for how much money that can be made. Agents email me every other day telling me they have listings on the site that they had given no permission putting there, logos which are stretched and what has to be the worst site usability I have seen with for many years. I have had a number of emails from people saying I was too harsh on them, but to be honest I had worse to say but held back. Now after spending a frustrating hour on the site tonight, I have nothing good to add – nothing. The deeper you go into this site the harder it gets and I may be no genius but I do know how to navigate a good site and this my friends is not a good site.

New Revenues: New revenues? Revenues! You watch, the free offer will be extended and extended again, because, why would any agent bother advertising on a site that gets very few visitors and no agent results. So you could say any revenues are new revenues, but after the worst start in classifieds advertising by a major player in Australia’s history things can only look up – or can they? Once the marketing stops so will the visitors and the statistics make the story look a hell of a lot worse.

Problems: Without trying to sound like I am repeating myself. Fix the damn site up. It looks like cousin Jeffrey did the design and the usability is atrocious, for the love of %^&$#, get a professional in.

Secondly put your wallets away and stop marketing the site until you get these things fixed. I cannot belive that 5 weeks on the site has hardly fixed the usability issues, there is simply no flow. I got stuck for about 10 minutes after looking at a larger map, I seriously did not know how to get back to the results.

Let’s just say they pretend for one minute that they get these things right. Okay, you have 10 million to spend, why not put 200 sales staff on and get out and door knock every single agency in Australia, drop off a prospectus and give all agents 2 years free on the site with some guarantees on fees and product packages going forward. Then once you have 80% of REA’s listings, then spend the 10 million telling all of Australia about it.

Challenges: Get a person in charge of all development that knows how to rebuild a real estate portal for the user and for the agents. There are plenty of good people out there. Whilst Ninemsn is a showcase of how NOT to treat your visitors, at least it looks professional, so please please, please make it look like you know what you are doing.

Some Stats: The site had 251,000 visitors in the first month. This does not sound too bad, but go deeper and it gets much worse. Consumers spent on average 128 seconds on the site, yes 128 seconds, go to the site and see how much you can get done in this time (and think about the 40% of people on 56k Modem Connections). You also have to take into consideration all of the agents looking at the site and seeing if their listings are on there. REA’s average time is just under 12 minutes. That means users are going into the site and having a quick look and leaving.

THE BIG ISSUE
So we come to the biggest challenges all of these sites face. Google, Yahoo and MSN are looming large. The reason I count the other two alongside Google is because anything Google do – Yahoo and MSN more often than not follow.

What this will mean for the market is simple. I don’t think there are too many people in Australia doing their property buying/renting research offline, so all of these new entrants are only going to be taking visitors away from the incumbent portals REA, Domain and MyHome. I am going to concentrate on Google here, not because they will be first ( personally I think they will be) but because they will be the most popular in this country.

Google will be free for agents, they will also not distinguish between a private seller and an agent so it will boost private selling across Australia to around 10% or maybe more. Many more home sellers will try this at first and many will also return to agents if not successful. But the key point here is that it will be FREE, the model for Google is to give software and systems away for free and place advertising alongside this data. The current portals try to have it both ways. If Google enters then the current portals fees will drop overnight. Google will not get the same press they have had in the past as most of the major media players in Australia now have a interest in real estate, but consumers have an amazing affinity with Google and their software. More often than not Google’s software looks clean and plain but works like a treat and is easy for a user to pick up in little to no time. A Google Real Estate Search Engine would look like the Google Search but with photos and links to more data such as maps. Advertising will be the same (Adwords) and the site will be lightning fast.

The systems will be clean and you will be able to use Google’s System or set up an RSS, XML feed into their system. You will also be able to create reports and have these emailed to you on a regular basis. The systems will also be feature packed with other webmaster tools like Google Sitemaps and Google Analytics.

So, this will basically mean REA, Domain and MyHome will have to work fast now to get the listings. They will also need to develop new sites that are ready to go once this challenge comes. This may not happen for a few years but the bottom line is who can react the best to this challenge? REA know they are slow to make changes, to crank a new website would take less than a few months if they didn’t have to deal with the way 3rd party advertising is structured on their website and Domain will suffer if it is still number two by a long way when this launches. MyHome will have MSN to fall back on locally although I doubt on a global scale MSN would worry about the deal with PBL and probably already has some clause of separation in place.

So if Google affects the online world it will hit traditional newspaper property guides even harder. Already more and more vendors are going for Internet marketing first and then newspapers (traditionally the other way around) and as the market remains cool, this will be more prominent in promotional plans going forward. It doesn’t matter if agents feel more comfortable with newspapers, it is the vendors that will make the decisions with marketing dollars. More and more Vendors now know that a $1000 Internet marketing campaign that lasts until the property is sold and contains images, detailed property information, floor plans, videos and podcasts is a smarter first up option versus a $6000 newspaper property guide package that has big glossy ads and lasts only one day and contains very limited information to the consumer.

So we all face challenges, portals, agents and even humble developers like myself, but it is the ones who can react to these changing conditions better that will survive. Sure some will tick along nicely but the days of getting agents to pay for providing portals with valuable content that they in turn use to attract 3rd party advertising are coming to an end.

Yesterday I received a tip off about a new site that Fairfax had launched. It is called the Brisbane Times and it is an online newspaper that compliments an off-line newspaper.

Only difference is – well……there is no off-line newspaper! You know how I wrote about that silly promotion Channel Nine’s marketing department has come up with and continually drills down our throats? 2007 is Nine?

Well at this stage 2007 is Fairfax as this new site is a master-stroke and ushers in a new era of online sites.

Okay, Fairfax do not have newspapers in many of the major capital cities – Hobart, Brisbane, Adelaide, Perth and Darwin, but with this new site it has thrown down the gauntlet and entered new areas with local content, matched with their Melbourne, Sydney and Financial Review online content.

But think of this, they can enter all of these markets with their online newspapers, staff it with local writers and advertising staff, out of small offices and do it in each region for less than 1/100 of the cost of a traditional newspaper.

Then they can market their online products, Domain, Adore, Drive and MyCareer to each region more than paying for the small team in each region.

These regions are dominated by News Ltd and their online/off-line products so we will see some fairly stiff competition. Yes it is not the same as having a newspaper, but it does place allot of pressure on News Ltd and their costly off-line offerings.

It also gives them sensational exposure and lowers the price of online advertising locally for small to medium businesses that have had no choice but to advertise on the incumbents site/newspaper.

Add the impending merger between Fairfax and Rural Press and you have an even bigger coverage across Australia than even News Ltd can offer!

So what can News Ltd do? Well Nothing, News are already in the markets that Fairfax dominates and have thrown tens of millions of dollars at The Age and The Sydney Morning Herald’s classifieds only to come away empty handed.

So Roberts continued bedpost kissing – dreaming of Fairfax Digital Department has not left him deserted as I think this is one of the smartest media moves I have seen in recent times.

I just hope they go into other capital city markets and place some pressure on the incumbents. If they do, I think they are on an absolute winner and this can only be good for real estate agents gaining even more exposure….

Over to you News……….

So why will PBL’s attempt be more of a threat to realestate.com.au than justlisted.com.au’s? If you read today’s article on news.com.au you would think it may well be impossible, but that is because the so called analyst (these people know about money markets not online markets) Ivor Ries has no idea about what it takes to be successful. So this is why PBL are different to Justlisted and Sensis.
1. Television (Channel Nine)
PBL can draw on the many popular property lifestyle shows to promote their new entity.

2. NineMSN
NineMSn is one of the most popular portals in Australia and much of realestate.com.au‘s early success was due to the fact that real estate searches on NineMSN were through realestate.com.au

3. Experience
PBL can draw on the success of all of their online sites that are market leaders including NineMSn and Seek.com.au. Seek is by far the most popular jobs site in Australia and they will no doubt promote it through this site.

4. PBL Know
PBL know the Internet, whilst Sensis just know they have products that people need. There is a big difference, Sensis have without doubt been the biggest corporate failures in the Internet space in Australia’s history, whilst time and time again PBL create success stories (not always but most of the time), so PBL know that by creating successful partnerships they can bring not only agents onboard but also consumers.

INSIDE DAVE

I have to give ‘Insider Dave’ credit for this one and I have included his email to me below in its original format. He was out on a few things and some others will tell in good time, so thank you Dave!!!!

“A new real estate site is likely to be launched in australia in the next few weeks called www.propertyseek.com.au

• The site will be a venture between seek.com.au and 4 of the franchise group head offices.
• The franchise group head offices will own equity in the new business
• Offices will pay $175 per month to advertise all their listings
• Offices will not own any equity – just the head office
• The franchise groups participating appear to be lj hooker, raine and horne (nsw), elders and c21
• Is this just anoter version of propertypage?
• Is this a threat to domain and realestate.com.au or just another money grab by the franchise groups?

Seek has 2.2 million visitors each month, i believe that domain has 1.6 million and realestate.com.au has 3.2 million … how many job hunters will look at real estate too?

Could domain and realestate.com.au go into jobs? Will it affect seek’s margins and therefore share price?

…………..Dave

Here are some of my predictions……..
1. PBL will buy Fairfax (not the other way around) and will then hopefully do something about Domain.com.au and some other sites. Recently PBL sold their shares in Realestate.com.au and has no finger in the online real estate pie.

2. News Ltd will buy either Channel 7 or 10, which will give them a younger audience mix with their tired and declining newspapers. They will also take full control of Realestate.com.au at any price. This will give them a full suite of classifieds online and a great way to get these out to everyone.

It is pretty common knowledge that newspapers is a distant second to television for advertising purposes and this will give both Fairfax and News Ltd the valuable tie ins they need to keep their newspapers making money. (and possibly the only way)

This is where the wars will begin, TV shows/Newspapers tied in with online properties (jobs, cars and houses) all over the place. The upshot of all of this will be some real competition for realestate.com.au.

The downside is we will have to decimate further what is news and what is actually self promotion and will surely keep the industry ombudsman busy. The government needs to be very careful (and won’t be) how all of this ties in.

For agents, it will sadly mean ever increasing advertising fees for both realestate.com.au and domain.com.au

Watch this space….

I think they do as they have shareholdings in Seek (jobs) and their Carpoint (cars) and all they need is real estate to participate in all “rivers of Gold” classifieds.

The big question is what if anything is out there? Realestate.com.au has all but shored up the online real estate portal market and there really isn’t any else of significance out there.

Things may change with the easing of cross media ownership laws but as it stands they will either have to start something from scratch which will take years to build up.

My guess is they will wait for something to emerge from the market and invest like they have done with Seek which pretty much has the same share of the online jobs classified market as realestate.com.au share in the real estate market.

Yes, realestate.com.au are the kings of real estate in Australia and it will not be too difficult for them to control the New Zealand market (this will take at least 3 years and plenty of freebies to build market share). But this is only the first round of the war and new technologies will emerge.

But for the next few years they will rule the real estate marketplace. It is companies like PBL that may come in from the dark sooner rather than later that could upset the trend.