IDX, or Internet Data Exchange, and VOW, or Virtual Office Website, are the standard protocols that allow brokers to display each other’s listings on their own websites for consumer use. Compass appears to be making a distinction between these consumer-facing uses of data, which are essential for marketing properties, and the "back-end" data licensing deals that MLSs strike with technology vendors. The firm’s letter suggests that while it accepts the necessity of IDX and VOW for the sake of the market, it does not believe that participating in an MLS should mandate the sharing of data with companies whose sole purpose is to help other brokerages recruit.
The letter also includes a specific provision for Compass’s franchise broker owners, noting that they would be allowed to opt-in to sending their data to these recruitment vendors if they choose to do so. This distinction highlights the difference between the company-owned operations of Compass and its newer franchise model, acknowledging the independent business decisions of franchise owners while maintaining a hard line for the corporate-held entity.
Perhaps the most aggressive portion of the letter is the mention of potential legal ramifications. Compass asserts that the mandatory submission of listings to the MLS, coupled with the MLS profiting from the sale of that agent-level data to recruitment tech firms, "results in damage claims to the MLS." The firm has offered a conditional release of any such claims, provided that the MLSs agree to the requests and implement the requested changes within a 30-day window from the receipt of the letter. This ultimatum suggests that Compass is prepared to escalate the matter if the MLSs do not comply with the request to restrict data access for recruiters.
This latest move by Compass is part of a broader trend of the firm challenging the established rules and norms of the MLS system. Earlier this year, in March, Compass joined forces with other major industry players, including Redfin and Rocket, to send a letter to MLSs regarding "pre-marketing" and phased marketing rules. In that instance, the companies urged the MLSs to adopt policies that would allow for "seller-directed marketing plans" without penalizing agents for marketing a home before it is officially entered into the MLS system. These actions collectively suggest that Compass, under Robert Reffkin’s leadership, is increasingly willing to use its market position to advocate for structural changes in how listing data is managed and controlled.
