Airlines vs. Real Estate- The Real Estate boards are heading for a wake up call.

As I settled in yesterday for my 45 minute flight from Ottawa to Toronto, I was pleasantly surprised when the Air Canada attendent handed me the Saturday edition of the Globe and Mail. I get most of my news online, but even this techno-geek can appreciate reading a newspaper on a plane!

As I leafed through the pages for something work reading, I came across this great article in the business section about how the internet has unlocked the mysteries of the real estate market for many in the US by essentially removing the information assymetry in the market. For those non economics orientated folks, this means that the information is no longer controlled by experts (agents), but is available to all freely. This "democratization of information" enabled by the internet is one of my favourite topics to read about, because it has some profound implications on how business and governments operate. This topic is talked about extensively in one of my favourite books "Growing up Digital: Rise of the Net Generation" (look for my review of the sequel soon once I get a chance to read it). Excuse my ranting, I'm a bit off topic here...

The article goes on to explain how the real estate boards across Canada are resisting this change at any and all costs, because it is a threat to their business models... how ridiculous. The article goes further to explain that the argument from real estate boards is that Canada may be too small of a market for online real estate databases to work... give me a break.This ridiculousness was amplified when I switched over to the next page and read a frank discussion on how the iPad will likely not save the traditional publishing industry. I'm no Mac fanboy, but I do believe that the Apple business model is solid... embrace change, and profit from it! The iPad article goes on to explain how Apple, Google, and Microsoft have created shareholder value by investing in innovation, and changing with the times, while traditional publishing companies who resisted the change (think newspapers and magazines) are struggling to keep their heads above water. I can give another example of how another industry made the exact same mistake in one word: Napster.

The irony comes in when I began to think about the plane I was sitting on... I found my tickets online (and searched for the best price/time combination), purchased them online, had to option to check in online, and I could even print my own baggage tickets so I wouldn't have to wait in line at all, save the infamous security line. My question then became, if the airline industry, a capital intensive and low margin business can move their operations online (likely out of necessity after 9/11), what is stopping the real estate boards? The answer? Closed mindedness.

My message to the Canadian estate boards: Go ask any airline executive if their legal tactics stopped priceline.com or selloffvacations.com from being successful. Better yet, go ask any book publisher if they were able to stop Amazon from launching the Kindle e-reader... get with the times or your industry is going to have a very rough go of it in the next few years.

EDIT: I'm new to this still, so my link didn't show up. here are the articles i was referring to:
http://www.theglobeandmail.com/report-on-business/the-battle-to-unlock-the-housing-market/article1450088/
http://v1.theglobeandmail.com/servlet/story/RTGAM.20100129.escenic_1449996/BNStory/DEREK+DECLOET