“What the hell does Zillow mean?” It was 2015, and the bull-headed media mogul Rupert Murdoch was speaking at a gathering of 4,000 real estate agents in Midtown Manhattan. “We know what ‘realtor’ means,” he said.

While it makes for a good sound bite - Murdoch’s assertion that ‘realtor’ is a better consumer brand misses the point entirely. Consumers want a house or an apartment. They don’t want to work with a realtor if they can avoid it. Consumers work with realtors because they don’t have a choice.

You could say, ‘What the hell is an Uber?”…“We know what ‘taxi driver’ means.” Let’s be honest: the taxi driver, delivery guy, or realtor isn’t the part of the transaction that consumers enjoy. That’s not to say all drivers, delivery or realtors are bad - just that they are an efficiency hack for a market without software. That is also not to say that realtors will go away entirely - but their role in the sale/rental transaction will diminish as software is introduced to more efficiently solve consumer problems.

Realtor and Zillow aren’t true software platforms. They are a collection of advertising tools for real estate. They also lack a vision for how someone can list any type of property, acquire a renter/buyer, securely store documents, and handle the financials of the entire transaction. The $15b market of real estate advertising seems attractive, however, it pales in comparison to the profits that can be unlocked by charging transaction fees. Amazon Web Services (AWS) is a tax on the modern consumer internet - there is no company that has achieved that in real estate.

To put it simply: if digital advertising is your primary business model and you’re not Facebook or Google - you’re fucked.

Is Rupert Murdoch the one person who poses a threat to @streeteasy's NYC domination? (@ebsolomont) https://t.co/qc3uDmzSKc

— The Real Deal (@trdny) October 3, 2017

The short answer to the tweet: no. Attempting to replicate StreetEasy or outspend Zillow won’t work. Zillow has already achieved the network effect in real estate. In order to disrupt Zillow - you’ll need to rethink real estate technology. Trying to be a better partner to realtors than Zillow isn’t a strategy, it’s just posturing.