Will the current Subscriber based data services survive in the long term?

Implications: The web based on-line commercial real estate data providers such as Costar and Loopnet better start to look around or in the next 3-5 years they may not be in business. The Internet is far from dead, and it is more robust than its ever been when it comes to commercial real estate information. They were the paradigm shift back in the mid to late 1990's when the Internet and aggregated commercial real estate information became readily available thereby leveling the playing field between brokerage firms. It no longer mattered what firm had the most number of listings both exclusive and open...it then became a matter of transactional skill in putting a deal together. The fact the brokerage firms have become dependent on these web based info providers, does that mean price points for the services are not relevant? No is the short answer...price does matter as does the quality of the info you are paying for...This is not the 1990's any longer.

Analysis: The age of the internet has brought to the commercial real estate sector an information platform like it has never seen in its history.

Today with Google Earth and MSN Virtual Earth, and Keyhole technology, no longer are those in the commercial real estate sector bound by one or two data providers. These new services will aggregate much of the data into one viewing panel enabling the user of the data to see building info, demographics, planned/approved future development, traffic surveys, ground level photos, zoning, tax and assessment info, sold property information and many other informational points of interest.

Many of these data points already exist for free through on-line government web sites. Some jurisdictions already have building photos of the properties in the tax database.

The government providers of this information have begun to understand the cost savings of placing this info on-line.

The Google's and MSN's already understand the value of their services when they integrate them with real estate info and consumer info.

So why will commercial professionals need a paid service to find information that is easily obtainable and will become even more so as time goes by?

The commercial brokerage industry is already working on a system wide data solution akin to the residential MLS. Why should be the question, and the short answer is the industry does not want to be held hostage by one or companies providing the information that is already out there, and having to buy back their own information that is voluntarily given to the data providers.

Once the commercial brokerages figure out that if they play nice with each other, there is plenty of business to go around ,they will realize they don't need the cost of information to be anywhere near what it costs today.

The information is rapidly becoming a commodity and that should mean it should become cheaper.

This is just the beginning of a new revolution in commercial real estate data and as far as I have seen. Costar and Loopnet have not kept pace except trying to win the race of having the most number of properties in their respective databases...sounds familiar?

There will be a new paradigm shift and unless they can be part of the new shift, which by the way, does not translate into them making money in light of all the free access, they will find it very tough to maintain their respective price points. This holds especially true for Costar which is much more costly than Loopnet for their respective subscribers.

This won't happen over-night but the change is coming...stay tuned.