Move Inc. CEO Steve Berkowitz likes what Zillow’s plan to acquire Trulia for $3.5 billion in stock has to say about his own company’s value.
Given realtor.com operator Move and Trulia’s similar size, “We like the comp,” Berkowitz told investors today on Move’s second-quarter earnings call.
The merger will create a mega-rival to Move, with a massive consumer audience. But Berkowitz says realtor.com’s advantages in terms of listing accuracy will persist as its competitors progress along the path to a merger that’s anticipated to close next year.
Thanks to its relationship with the National Association of Realtors, realtor.com receives listings directly from more than 800 multiple listing services across the U.S., giving it an advantage over Zillow and Trulia in terms of listings comprehensiveness, timeliness and accuracy in some markets.
Zillow and Trulia get direct feeds from MLSs in some markets, but in others they get listings from a patchwork of sources including brokers and syndication platforms like Move’s ListHub and Point2.
Berkowitz also said he hopes the high-priced acquisition helps brokers and agents firmly grasp the “transfer of value” of billions of dollars that has occurred in the last three years around listings from them to Zillow and Trulia.
Along with that hoped-for recognition, Berkowitz says Move is well-positioned with ListHub to give brokers and agents the tools they need to take control of their listings.
Zillow and Trulia continue to woo brokers and MLSs to obtain direct feeds and short-circuit realtor.com’s claimed accuracy advantage, and to bypass ListHub in the process.
“Both our companies will continue to acquire more direct listings, relationships with brokers and MLSs during this period, as well as post-closing,” Zillow CEO Spencer Rascoff said in a conference call he and Trulia CEO Pete Flint held Monday to brief investors on details of the merger plan.
Rascoff outlined intentions to continue operating Zillow and Trulia as separate brands, saying “the two firms’ offerings remain differentiated and the consumer overlap in both brands is relatively low.”
Having “multiple brands inside the same corporate parent allows us to better serve a larger audience, while taking advantage of certain shared back-end services,” Rascoff said, noting that the companies expect to achieve $100 million in annual savings by the end of 2016 through efficiencies through shared services such as sales and marketing.
Move’s revenue grew 7 percent year over year in the second quarter
Move’s second-quarter revenue of $61.3 million represented a 7 percent increase over the same quarter a year ago. The firm reported a net loss in the quarter of $6.3 million, which it attributed to spending associated with the launch of its “Accuracy Matters” national marketing campaign in May.
Move also lowered its full-year 2014 revenue projections from a midpoint of $256 million to a midpoint of $253 million based on shrinking revenue on the moving side of its business and a one-time hit associated with the “distributed denial of service” cyberattack that disrupted several of its sites, including realtor.com and Top Producer, for several days in June.
