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Property software focus - Part 3

publication date: Jun 3, 2010
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Software focusTen years ago, the internet started changing the way we did things. Life became rather more interconnected; agents needed to put their properties on the web, emails started replacing faxes and phone calls and the new property portals began to replace local newspapers as the prime advertising resource.

Now, we may be approaching another massive change in the way we do business.

Two key trends are expanding the requirements for property software – first, mobile access, and secondly, the demand for the software to link up different users, rather than remaining the exclusive property of the agent.

Mobile access can mean leaving the branch office behind and entering the world of the virtual agent. Increasingly, agents are accessing their databases on the move, or from home offices, and that’s led to new requirements for software to connect agents up wherever they happen to be – and whatever device they’re using.

Stewart AndersonStewart Anderson of Aspasia points out that, “Virtually all the new software that’s come out in the past couple of years has been web based,” because it allows that connectivity. “The world is moving away from the desktop,” he says; a system that doesn’t allow the user to choose when and where they access it won’t fit the bill for most agencies.

Agents don’t have to be ‘virtual’ to gain benefits from mobile access - there are huge cost savings for traditional agents, too. Mark Howlett of PropCo says, “There’s a lot of on-site time spent by agents when they need to capture information, and you can cut out rekeying if you can use a mobile device to enter the information straight away.” Not only is this much cheaper than writing down the information and then rekeying back at the office, but it also cuts down on the room for error.

Access all players

But it’s not just agents who want to access the software. Landlords, contractors, vendors and purchasers all now want to access the database directly – rather than having to telephone the agent to get the details. Many systems now enable them to do so, using various methods to control what information the client can see.

Vendors can look up the progress of their deal, contractors can automatically be invited to bid for work that needs to be done. The software can then become more like Facebook, bringing the stakeholders together and providing them a platform for communication, rather than like a traditional database application.

Peter Grant, MD of VTUK, believes there are real benefits to be gained by opening up the system. VTUK’s Pisces, for instance, is “a web service that allows all of the stakeholders in the business to communicate,” he says, making interaction with clients quicker and more efficient. VTUK has also become an O2 technology partner, so access can be provided through iPhone applications.

MARK HOWLETTMark Howlett believes that access to the system can be a key differentiator that will win business for the agent. “One of the significant points of joined up communication is the transparency,” he says. “If you’re happy to let a landlord see everything that’s on the computer about his property, the contracts, the invoices, and so on, then that transparency can add real value.”

When it comes to specifying the technology, there are a number of ways that remote access can be provided. Mark Quigley of CARL says, “You can achieve a remote working solution through a number of alternative technologies; you can use virtual private networks, remote desktop technology, or web based access.” There’s nothing particularly new in the technology - it’s the demands being made on it that have changed.

Increasingly, though, cloud computing is in the news. Mark Howlett says, “The cloud is a bit of a buzz word in property right now.” Instead of the agent installing software on their own computers, service providers use networked processing power known as the ‘cloud’ to run the system and store agents’ data. Howlett says users prefer web-based access, and they are voting with their wallets. “Since we’ve had the web-based system, we’ve had people migrating to us from other systems, which wasn’t happening before.”

Some providers, like Aspasia, can offer pure cloud services; others, like DezRez, offer hybrid models, which blend the off-site model with software loaded locally on the PC – that can speed up data processing.

“For us, cloud computing isn’t a new thing,” says Wilf Lewis of DezRez. “We’ve used the off-site model in one form for ten years and been pooh-poohed by competitors with client/server models – we’ve got a wry smile on our faces now.” Vebra also has a hybrid, VebraLive, which offers web-based functionality while keeping the data in the branch - “something that strikes a chord with a lot of agents.” says Vebra MD, Tim Summerley.

the cloudBecause web-based services are usually sold on a monthly subscription, rather than on an initial licence fee basis, they are proving particularly attractive to start-ups, to virtual agencies and home-based businesses. But Vebra is also seeing a number of medium sized businesses are looking at VebraLive to enable remote management of branches.

However, these hybrid systems are not 100 per cent ‘cloud’, says Stewart Anderson of Aspasia. “There is software that is client/ server based and uses the web to synchronise branches,” he says, “and there is the truly web based solution. You need to establish whether there is a true independence from the desktop.”

The arguments against the Cloud

There are a number of arguments against the cloud. In some areas, both in the geographical sense and the business application, there are issues. Nigel Parsons of Landmark Systems says that where the database size/structure is relatively small (excluding images) and the changes being made to that data are not frequent (as in estate agency packages) cloud/web based may well be the way to go, if the broadband infrastructure is in place.

“However,” he says, “where property management is involved, potentially with client accounting issues involving huge numbers of transactions passing back and forth, a local sever may be far more efficient – and totally within your control.”
And, he adds, “Don’t forget that ‘cloud computing’ is a great way for the IT industry to tie their clients in – check the data storage and support fee structure carefully – the service provider holds all the cards in this scenario. If you don’t pay you won’t have access to either the software or your data”.
“On the rural front cloud/web based is sometimes simply not practical. Promises of improved broadband delivery are being made by all parties… but it all takes time to arrive – literally!”

SECURITY ISSUES?

PETER GRAN TSecurity is definitely a major issue. “If you’re allowing a third party to look after your data, how secure can it be?” Peter Grant of VTUK asks. He doesn’t believe agents will be happy using the cloud. “The only real value of an agency is its data – whether it has nice looking branch offices, smart looking cars – so our clients will never dream of giving their data to someone else.”

Phil Barton says that Property Intellect “made a specific decision not to go online” because of this. He also believes that data protection can be an issue (for instance if customer data is being held outside the EU on a US-based server).

But Glyn Trott of LetMC says that using a cloud system can make data more, not less secure. The greatest risk to most agents, realistically, is a negotiator taking a copy of the data when they leave – and go to another agency – or staff giving up their passwords. “Ironically, if you host your own software and your own data, you can be more at risk. I’ve had two clients where someone walked in, picked up the machine and walked out, taking the business with them.” If the data is held by the service provider, no one can steal it from the branch and the software has been designed not to allow negotiators to download or print out client lists. Besides, the service agreement includes secure hosting of data – for instance Expert Agent backs up data at two separate locations; that’s not the case with the traditional software agreement.

Phil Barton also worries about what happens if the software provider goes bust. “In the case of a locally Phil Barton installed product, you’re sitting on a database on your PC,” he says. The software will carry on working, though eventually a new system will probably be needed. If a cloud-based provider goes down, there will be no access to the data – or to the software.

Glyn Trott replies that good cloud providers have thought this through. For instance they will often put the software in escrow, so that if anything does happen to the software provider, the client can take possession of a clean copy of the software. Besides, he says, if the company goes into administration, the administrator has a duty to keep the company saleable, “and that means keeping the customers running.”

The whole model of providing software as a service, though, should help cloud providers keep solvent. As Trott points out, “As a subscription based company, we have regular funding, month in month out, and we don’t have to sell five new licences to keep going.”

There are certainly a number of convincing benefits to cloud computing. One is that the cost of data storage and processing power is shared between all the subscribers. Glyn Trott says “With the subscription fee you’re not only paying for the software, you’re also paying for hardware that as an agent you couldn’t possibly afford.” He believes that’s something that is particularly attractive to start-ups, though LetMC also appeals to mid-size clients with 9-10 branches, like Jordans Residential. “We can serve the smallest and the largest,” he says; “that’s what the cloud enables us to do.”

Stewart Anderson points out that as locally installed software, using the powerful Oracle database, Aspasia had identified the big multi-branch agent as its target market. But the advent of the cloud enabled it to broaden its appeal. “We took a real punt, and we created one of the first web based products in the market.” While it’s still not economic to provide the software to clients with fewer than ten users (or seven, on the lettings side), Aspasia has definitely moved out of its blue chip niche.

Cloud computing is, in some people’s views, more directly beneficial to software providers than it is to agents. Hosting software applications “in the cloud” simply means that we are using different server hosting providers.

Using ‘the cloud’ basically refers to using anything other than your own servers to store your data and programmes”, says Charlie Wright of thebu2iness.com, which has hosted all it’s software in the Amazon Web Services cloud since early 2009.

“What this means for our clients is a faster and more reliable product. They also don’t have to worry about our own servers running out of space or power or bandwidth. Amazon is the world’s largest online retailer and we now have their hosting might behind our product. It also allows us to offer a great unique feature – Unlimited File Storage, taking the strain off our clients’ computers. This means we can focus on developing functionality rather than managing hardware.”

Remote upgrades and a relaxed client

Maintenance and updates are also much easier with web-based products. Glyn Trott says “The moment you choose to buy and install computer software on your own system, you are becoming a computer specialist – whether or not that’s what you want.” With a web-based system, all the upgrades are handled by the software provider on its servers and customers get the upgrade automatically.

Wilf Lewis Wilf Lewis agrees. “That is the beauty of the cloud model,” he says. “There isn’t much for the client to do. When they log in, the installation happens automatically.” At the same time, he says, clients are making significant cost savings. They don’t need so much IT support on site, and they don’t need to buy extra high-end servers.
He believes using the cloud also helps link new partners into an agent’s network. For instance, DezRez is now building conveyancing into the package of services it can offer – “services with your software” he quips, “rather than just software as a service.” All the conveyancing data can be integrated into the workflow, cutting out the need to chase over the phone and allowing agents to see instantly how far the paperwork has progressed. Similarly, LetMC has built Equifax credit reports into the system, so agents don’t have to go outside the software to find whether their tenants are creditworthy.

Both cloud and hybrid models – and even some traditional, locally-installed products – are now being sold as monthly subscriptions. Philip Evans of Pex Software says, “The market is moving to software rental models, agreements that include support and maintenance and hosting and licence fee.”

Obviously, that helps remove barriers to entry for start-ups and smaller agents. Even for larger agents, it can cost in against buying a package, where agents will still have to pay between 10 per cent and 15 per cent of the licence fee per year as a maintenance fee (or run the risk of operating the software without support, and without upgrades).

From software as a service, it’s not a huge leap to outsourcing and LetMC is already offering outsourced services for landlords, such as rent collection. Glyn Trott says the recession, and the need to save cost, has changed the industry’s traditional unwillingness to outsource. “Clients can outsource their accounts, or they can outsource their rent chasing,” he says. By doing so, they can concentrate on marketing their business, and they only pay when the money comes in, not up front.

Although it’s still early days for cloud computing and collaborative software, the future is likely to see software moving away from the desktop model and becoming something rather different. Mark Howlett believes that software development will be driven by the demands of a new generation of users. “People who use online banking, who use Facebook, who use online software to organise their lives.”

A Facebook Future?

Glyn Trott In fact software could end up looking much more like Facebook than like a traditional office system. Glyn Trott says, “We’re seeing incredible convergence between software systems; we’re seeing a lot of social media and marketing merging, and we’ll see quite soon the portals merging with software – portals behaving like software houses, and software behaving like a portal.”

It’s an intriguing vision and one that needs web technologies to make it work. While traditional software might still be working for some, Stewart Anderson believes that longterm it won’t cut the mustard. “Although they’re making money now,” he says of ‘unwired’ agents, “if I were them I’d be worried about the next five years. The world is definitely changing.”

Making a decision on software? Read propertydrum's chart of key features