Reading of lengthy judgment says that OTM needed ‘one other portal’ rule’ to enter competitive market

Agents’ Mutual  could not have successfully entered the UK property portals market without the ‘one other portal’ rule, intensive reading of Wednesday’s lengthy judgment implies.

A number of other portals had tried to enter the market prior to OTM, but failed. These included the  portal launched by the NAEA and NeedaProperty, said at the time to have the substantial financial backing required for success.

The ‘one other portal’ rule adopted by OnTheMarket could even have gone further, said the Competition Appeal Tribunal.

It said that considering the difficulties facing a new entrant to the UK’s portal market, it “would not have been unreasonable for Agents’ Mutual to require complete exclusivity from its estate agent members”, the ruling states on page 140 of its judgment.

But having settled for ‘semi-exclusivity’ with the implementation of the ‘one other portal’ rule, the Tribunal said this was ‘an essential part of OnTheMarket’s entry strategy and central to its chances of success. Without the rule, there would have been no entry.’ (Page 135)

Laying out their conclusions in a legal judgment the panel said the rule  was ‘objectively necessary’ (page 162) and ‘pro-competitive’ (page 150) because it increased competition between Rightmove and Zoopla to become the remaining portal choice for estate agent customers (page 150)

In addition, the Tribunal commented: ‘The notion that the entry of a new competitor onto a market should be anti-competitive is an inherently unusual suggestion’. (page 124)

The judgment appears to make a strong distinction between the concept of harming marketplace competition and harming an individual player in the market: ‘The fact that Agents’ Mutual’s entry onto the market harmed Zoopla is not the point.

“If, and to the extent that, Zoopla was (through Gascoigne Halman) contending that its business was adversely affected by the entry of Agents’ Mutual, then this is a an example of competition working, rather than failing.’ (page 124)

The judgment was handed down and released following a trial in February after Agents’ Mutual initiated legal action against Gascoigne Halman for breach of contract when it attempted to list at OnTheMarket.com as well as both Zoopla and Rightmove.

Gascoigne Halman denied breach of contract and argued the One Other Portal Rule was ‘void’ (page 6) because it was anti-competitive and Gascoigne Halman raised other competition law arguments.

However Wednesday’s judgment states: “It is our unanimous conclusion that the competition issues are to be determined against Gascoigne Halman.”(page 161)

Gascoigne Halman had voluntarily agreed in January 2014 to list its properties with Agents’ Mutual for a five year period after the launch of OnTheMarket.com. At that time it was an 18-office independent estate and letting agent. But in October 2015 it was acquired by Connells Group which had and retains a significant shareholding in Zoopla.

The judgment also states (page 100) that ‘Zoopla had assisted Gascoigne Halman… financially to the tune of £250,000”.

Gascoigne Halman has suggested it may appeal, while Agent’s Mutual will be going after costs. There is also the possibility of a move by the OnTheMarket Action Group.

The full judgment – which does take some assimilating – is here:  http://www.catribunal.org.uk/files/1262_Agents_Mutual_Judgment_CAT_15_050717.pdf

 

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45 Comments

  1. Ric

    LMAO.

     

    OTM Action Group, please let me know where to email….

     

     

     

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    1. Trevor Mealham

      OTM WANT TO CHARGE AGENTS £1,000 PCM

      Has anyone read page 76 of the OTM trial bundle:

      http://www.catribunal.org.uk/files/1262_Agents_Mutual_Judgment_CAT_15_050717.pdf

      OTM want to charge you £1,000 pcm end game.   Reads:

      107B
      All members remain OTM + 1 and this gets us past tipping point 1 towards tipping point 2 where we are seen as strong enough for agents to begin withdrawing from Rightmove.

      108B

      End game – 15,000 branches at an avg monthly fee of say £1000 with no real need to list anywhere else. £118M income before any other revenue sources.

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      1. Ric

        and as a shareholder I look foward to my end game dividend. All hail Sir Springett!!

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  2. Robert Sargent

     
    Massive congratulations to Ian Springett and the OTM team. They have shown tremendous resolve under enormous pressure, whilst defending a vindictive and pernicious lawsuit, clearly stimulated by a bloated portal that appears unable to deal with what always was and has been proven to be fair competition.
     
    It’s good to know at least one portal respects that it’s the Estate Agent that provides the stock which drives traffic to their sites!!
     
    The Acorn Group now looks forward to hearing and supporting OTM’s exciting plans for the future.
     

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  3. Woodentop

    So there you have it, as was stated before the hearing …….. not a cartel, to break into a market a company may use restrictive practice, the one other portal rule, if it can justify it (this is written in legislation) and shot themselves right in the foot when Z got involved. That bit of corporate espionage in Northern Ireland meeting and to try and surprise AM at the hearing and ruling to accept  with guidance by the judge recommending not to make comment, was for me the end of the case. They could see exactly what was going on. Connells took on the contract when they bought Gascoigne Halman as just about set in stone. This case was nothing more than a very expensive threat to make AM roll over and die.

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  4. Marketshare

    Can anyone tell me what or who the OTM action group is please?

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    1. Marketshare

      Replying to my own messages, never a good thing! Now understand who the OTM action group is.
      Perhaps now the time is right for them to review their stance and get back on board?
      The contracts are obviously valid and there was a reason they joined in the first place. I understand their frustrations (I have questioned my decision to join a few times in the past year) but have always come back to the simple truth that long term if we can get it to work rather than bickering amongst ourselves it is a massive power shift in favour of agents and against other portals.
      I suppose the question is ‘do you want to be in charge of your online destiny or do you implicitly trust R and Z to look after it for you?’
       

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  5. AgentPink92

    Well done AM on winning this battle but by far the more important battle is to get any level of name awareness with the public.

    Posts on PIE about how strongly OTM is performing for members are as rare as hens teeth and until that happens the other big battle will be increasing membership.

    AM need to make some radical improvements quickly otherwise they are in grave danger of just fading away.

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    1. AgentV

      If OTM has ?7,000 agents paying ?£250 per month each thats £1,750,000 per month. Where is all that currently going?

      Could OTM not fund a marketing campaign, equivalent in size to that of PB, extolling the virtues of Full Service Agents and where to find them and their properties?

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  6. Trevor Mealham

    Laws an ass. The whole point is that OTM is allowed to embargo other new start portals whilst fighting to create a way to battle RM and Zoopla.

    . Or judges who didnt look at the larger picture in the industry.

    Or new court cases yet to happen to challenge the OOP rule. Sorry its anti competitive in other instances.

    The case is surely more about Connells buying a trading business that left a contract.

    In the same way OTM wanted a foothold that blocked out bigger portals to rise the ranks. Its OOP rule is ANTI COMPETITIVE.

    Zoopla standing aside Connells likely went against Connells as judges likely saw bigger portal wanting to keep smaller OTM restrained.

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    1. smile please

       
      Do you want some cheese with that whinge Trevor 😉
       
       

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      1. Trevor Mealham

        You need to realise that each case is taken on its own merrit and the GH vehicle was bought by Connells who decided to exit when the judges, judged they should have honoured what they had bought warts n all. The biggest wart being the AM/OTM contract.When OTM writes to smaller portals agents and ebargoes other traders. Sorry, thats anti-competitive

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        1. smile please

          * My reply on another news story you commented on today.
           
          Give it up Trevor, Nothing worse than a whiny loser. The naive, silly agents that signed up to a 5 year contract and expected a bucket load of leads inside 2 years are penny pinchers which is why they have set up this group. Chances of them stumping up 5-10k each for a court case is zero. You backed the losing horse Trevor. Your vindictive and factually wrong remarks and your inability to read the law will continue to haunt you.

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          1. Trevor Mealham

            I have left comment on the other site for you Smiler

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            1. Woodentop

              Maybe you should add to your rant on EAT that you have ignored to comment (just about every time you talk law) that legislation PERMITS RESTRICTIVE PRACTICE. Incitement leads to litigation.

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        2. Woodentop

          I wondered how long it would take for you to stop smarting at loosing Trevor ! You always went on about it being a cartel and kept very quiet when you quoted chapter abnd verse about EU legislation allows anti-competitive if can be justified. To call judges bent just about sums up why you should NOT be allowed ever again to represent our industry in any shape of form without OUR express permission. That permission will never happen. Gascoigne Halman lost, Connell lost, Z lost, Trevor lost. Any credibility you had just went out the window with your rant. Get over it.

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          1. Trevor Mealham

            When OTM wrote to smaller portals agents and placed embargoes. Thats Anti-competitive. FactNow judges have either been ignorant to that, and no evidence like that was shown at the case. I would like to think judges were ignorant to the wider industry impact of a portal trying to step up by placing rules in place on agents as to hinder bigger portals being unfair to other new entrants and smaller existing players.The Connells case is very different to how other cases in other instances might play out. My comments stand.

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            1. Beam Splitter

              The judges have stated that, as OTM stand now, the one portal rule is not just ok but pretty much necessary to break into the market.
               
              However, they did state that, if OTM where to become more powerful that this rule would be reconsidered. The implication being that it would then be deemed uncompetitive. So potential new court case in the future depending on OTM’s actions.

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              1. Trevor Mealham

                I can understand the reasoning for such rules. But had such a rule been in place, it could have stopped OTM entering in the first place.

                Such a rule needs looking at and maybe only allowed when the portal applying has bigger competitors. Otherwise if an agent does RM and OTM, it doesn’t allow new portals in.  

                If a agent does Z and OTM, again it doesnt allow new or smaller portals to gain memberships.There is also the fact that OTM is ignoring its OOPr to some sites that display multiple agents listings in a portal like way.

                My gut feel is that new big gun funds looking to do a portal would go to court and rip the OOPr to pieces (as it stands).

                As it stands OTM using the OOPr on smaller portal entrants is ANTI-COMPETITIVE. Even if judges allow it against bigger established portal players. 

                OTM should now publish a list of all embargoed portals as any other smaller portals trying to grow would have grounds to take the rule to court as unfair.

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                1. Beam Splitter

                  Though I basically agree with you Trevor, the courts have stated that they believe it’s fair at the moment. IF OTM grow larger however, then the OOP rule can be revisisted and likely would then be deemed anti-competitive.
                   
                  If RM or Zoopla introduced the OOPr, then that’d likely be deemed anti-competitive. Bit weird I know but that’s tribunals for you.  

                  EDIT:

                  >Such a rule needs looking at and maybe only allowed when the portal applying has bigger competitors. 

                  This is is exactly what the tribunal decided. 

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                  1. Trevor Mealham

                    Agree Beam Splitter. Thanks for listening and not being a mud slinger because the writer doesn’t get variations and who alter outcome.

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            2. Woodentop

              You just don’t get it on two fronts, one: when to shut up in the face of the obvious and two: your ability is very questionable and you sit on advisory panels with government decision making !!!!!!!!!

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              1. Trevor Mealham

                Yes they have to know who you are to invite you along Woodentop

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                1. Woodentop

                  And your qulaifications and crednetials are what … ZILCH.

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    2. Frown Please

      It is time to replace all the courts with Mr Mealham. He obviously knows so much more than the rest of the world. 

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      1. Trevor Mealham

        @Frown PleaseNot at all. But people are just looking at an agency that was taken over that left a contract which whatever the agreement the supplier would likely go after.And that the judges felt that the OOPr was fair to use against other BIGGER portals to level the ground. What wasnt taken into account was OTM being a bigger portal, writing to agents who were in existing contracts, saying they hd to leave.Each court case is different. I can assure you that OTM winning this doesnt make it the holy grail to all cases or the cure for cancer, human rights or green polution.This finding just applies that in a few instances this is what this court decided on.With different operatives and different argument, outcome could be very very different.

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        1. Paul

          Response to Trevor’s Statements

          “Sorry its anti competitive in other instances”
           – Not in this case though, so what is your point?
           
          “The case is surely more about Connells buying a trading business that left a contract.”
          – Don’t think so, it would have said that if it was.
           
          “Zoopla standing aside Connells likely went against Connells as judges likely saw bigger portal wanting to keep smaller OTM restrained.”

          – Doubt it helped, but who’s being anti competitive here?   Zoopla, who by the way are not the defendant or the claimant, colluded with a party, that if they won, would result in the best outcome for them.  Paying via the back door £250k to assist with the court costs and bringing about a case that they knew they could not win. But that wasnt the goal, the goal was to derail a promising start up company for a year and drain them of cash.  Looks like Zoopla were being anti competitive and using their muscle to do it!   And agents still want to be in bed with these people?  

          “You need to realise that each case is taken on its own merrit”
          – You need to realise, they all lost and you got it wrong, we would have more respect for you if you did.

           “Such a rule needs looking at”
          – It has been and they said it was fine?  Why do we need to look at it again, unless you can’t accept it?

          “And that the judges felt that the OOPr was fair to use against other BIGGER portals to level the ground. What wasnt taken into account was OTM being a bigger portal, writing to agents who were in existing contracts, saying they hd to leave”

          – I think they took a lot into account, are you not doing these people a diservice?  Propably some of the best legal minds battled this out over many months and concluded in this case it wasnt anti competitive.  Maybe in other cases, when AM get bigger etc etc then on that day the ruling may be different?  But lets just deal with this case and what Connell / Zoopla et al tried to say.

          “What I do not accept is that the Springett Lynch mob wrote to smaller portals to say agents HAD to leave. That is anti competitive.  Really the pot clling the kettle black.The OOPr is dangerous when stopping other new entrants or smaller portals from being able to gain subscriptions.I can see this is just the start of how the OOPr can be applied and if used to restrain smaller portals and new agent platforms could now back fire on OTM.”

          – It wasnt stopping new entrants, at that time and place, if you wanted to be a part of OTM, you had to be on one other portal, simple, that didnt mean 2,3 or 4, it meant 1!  Everyone had a free choice, either join or don’t, if you didnt, then you are free to list anywhere and everywhere, if the other portals offered a better and more convincing option, then they won out.  If you haven’t noticed, OTM hasnt succeeded yet?  That’s because people had and have a choice and OTM still have a job to do to convince everyone to join.

          It sounds like you have taken it all too personal and lost sight of the facts and judgements made.

          Whilst this might look like an attack on you Trevor, I’m just reading what you have said (it’s a lot) and feel it needs addressing, you may have some valid points that are relevant in other sphere’s or situations, but in this case they do not apply.
           

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          1. Trevor Mealham

            We’ll have to dissagree on various bits Paul. I think the great thing is that smaller and new entrants now have a case whereby they can use a OOPr to block RM, Z AND OTMThis battle may have been lost, but it may be a fight that used in other ways back fires on OTM.Any agent looking to join OTM will also think twice, thinking if it doesnt bring leads that losing business and ending up in court for leaving isnt worth the pain.I think in many ways the case will do a lot of portals smaller than OTM a big favour in recruiting which ultimately will block more agents in other OOPr from later joining OTM. 

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    3. PropertyLover71

      u ok hun? xoxo

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    4. PeeBee

      “Laws an ass.”

      Is that a quote made in an official capacity as a Company Officer?  

      Will that be the new Network motto, Mr Mealham?

      GREAT one coming from one who so often tries to use the ‘Law’ (as he reads it) to his advantage.

      From one whose CV is apparently littered with changes to Legislation off the back of his sole efforts.

      Funny innit how the Law is an ass when it reads different to the rest of the population.

      Unbelievable it’s come from one who should be preaching observance of Law – some of which apparently he helped to write.

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  7. Marketshare

    Hi Trevor,

    Surely no one was forced to join and before they did they understood the requirements.  The judges concluded that due to the duopoly the one other portal rule was necessary in order for OTM to stand a chance of success.  They went on to say that in fact the one other portal rule created a competitive environment by giving OTM a chance.

    I appreciate that we are all have a right to our own opinion but the decision was made after a proper and thorough process.  Let’s move on.

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    1. Trevor Mealham

      @Marketshare.

      * I agree with what you say that agents willingly chose to join and should honour such contracts

      * Connells chose to buy a entity and didnt wnat part of its obligations, when it was bought warts n all.

      * I get that the One Other Portal Rule allowed footholes and it allowed it a way to hold back competition from RM and Z which could bring a new No. 1 or No.2 .

      What I do not accept is that the Springett Lynch mob wrote to smaller portals to say agents HAD to leave. That is anti competitive.  Really the pot clling the kettle black.

      The OOPr is dangerous when stopping other new entrants or smaller portals from being able to gain subscriptions.

      I can see this is just the start of how the OOPr can be applied and if used to restrain smaller portals and new agent platforms could now back fire on OTM.

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      1. PeeBee

        “The OOPr is dangerous when stopping other new entrants or smaller portals from being able to gain subscriptions.”

        Not according to that bloke… what do you call him…

        …oh, yeah –

        THE JUDGE.

        Mr Mealham – step back; put your ‘reasonable’ head on (I know you have one somewhere…) and take a good, hard look at what you are poutting forward as your case.

        You have HOW MANY Agents that do not subscribe to OTM to go at?  

        You have HOW MANY of them currently subscribing to your “smaller portal” (that you now keep trying to play down as a portal despite previous claims to the complete contrary) / ‘Network’ / insert correct buzzword?

        How long will it take you to make contact with those that, so far, have not taken you up and ply your wares?

        I reckon you’ve got more than enough to go at.

        You are in a self-service restaurant.  The buffet before you offers all you will ever need – 

        an empty plate;

        loads of meat on the bone, and

        lashings of veggies

        plus some.

        Just don’t expect anyone to fill your plate for you – and don’t expect anyone to leave all the best bits for you either.

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        1. Trevor Mealham

          I think the OOPr could work for smaller than OTM existing and new entrant portals PeeBee.. …….and if used against smaller than OTM portals by OTM could now go against them.  The judges favoured the tactic in defence of RM and Z domination. Zoopla’s second portal also got named too.So on the basis that a smaller portal (or platform) can use tactics that a larger one can’t use in reverse. It actually brings nice dynamics for smaller portals to use OTM’s win against them. Unfair ethically, but if its the law, maybe a Godsent for new smaller entrants than the top 4-5 biggest.Without daggers and defense PeeBee, play nice.Logical view on my above sentences please. My view is that the OOPr could actually work against OTM, RM, Z and other big existing portals.Imagine if a large newspaper group or other well funded VC starts small, yet can lever growth by blocking bigger portals including OTM.

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  8. Certus

    Im only with Rm and thought long and hard about Am which I wanted to succeed. I believe that the on-liners are something we should be doing something about. But what?  If Z bought/merged with AM and only accepted advertising from High street agents, or better NAEA high street agents,  I think it would pull us all together. I would leave RM for that!

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    1. AgentV

      Can’t agree with you on the NAEA bit I am afraid when as an organisation they are allowing their online lister members to openly and publicly ridicule the businesses of your high street comrades…. without saying or doing anything. 

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      1. Certus

        good point. I Think if Z did it we could safely drop Rm and lessen any effect onliners have of piggy backing our listings. And when RM get around to accepting private listings, we wont care.

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  9. PeeBee

    Mr Mealham

    You have a problem with portals banning/embargoing/whatever – the example  you single out OTMs OOP Rule as ‘the problem’.

    I must ask if you should be airing your personal views in regard to that issue.

    Two reasons spring to mind – firstly (and most relevant) – you have eversuch a tad of a vested interest therefore it’s not exactly an argument based upon impartiality; reasoned opinion… or apparently not Case Law either (although in fairness the said precedent has only just been announced so you have lack of fact to rely on as an excuse up to Wednesday – when sheer ignorance unfortunately top trumps that excuse) …just needs of your business.

    Secondly, previous comment by yourself casts serious question over how you can denounce said situation, yet, here on the pages of EYE in March 2014 you stated quite clearly

    “In my view RM and Z should look after proper agents and ban agents offering selling fees anything below £1,000

    So somehow, that was goooood… and OTM’s ‘ban’ is baaaaad.

    Feel free to enlighten.  The floor, as is said, is yours…

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    1. Trevor Mealham

      For sure peebee. I fail to see how a £1,000 fee agent can take a listing on and max its exposure. You know the method I support is main/sub agency and we have agents doing well using cobrokerage and often gining substanially more for seller clients.The article could have been about sole or lone agency and I’d comment the same.WHICH did a good survey last year that showed only 860 (43%) of 2000 solds were generated via main portals.What more tradtional agents fail to gain credit on is the ways they often lever the 57% of buyers to sold that portals fail to bring.As such £1,000 fee leaves very little to entice any sub agents in who will have an array of alternate or differently located outlets to reach buyers the main agent may not.

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      1. PeeBee

        “I fail to see how a £1,000 fee agent can take a listing on and max its exposure”.

        That, Sir, is not your problem – it is that of the Agent taking the listing – and that of the vendor instructing them. 

        But if you were being totally honest and not scrabbling for an excuse for your words you wouldn’t have chucked that at me.  Better to sit back, think fully and then come back with a reasoned response – or just hold your hands up and admit you’ve been caught with your pants well and truly round your ankles.

        The rest of your advertorial is frankly cringeworthy.

        I really do expect better from you, Mr Mealham; I sincerely believe that there is better that could and should come from you – yet you always manage to disappoint so bitterly.

        Maybe I’m just being too demanding.

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  10. CDC

    “The naive, silly agents that signed up to a 5 year contract and expected a bucket load of leads inside 2 years are penny pinchers which is why they have set up this group.”

     

    That’s nonsense, Smile Please. No matter what you think of OTM it was never pitched as a slow burner. Springett’s naive promise of being the number 2 portal in under 2 years with an explicit date and then completely ignoring this when falling massively short of this goal is clear evidence of this, something which everyone forgets only came about when OTM quickly realised they couldn’t touch RM. Trevor is right, OTM’s mission is to create a duopoly/ monopoly of their own so if they are somehow successful from here on out do we just go back and review it again in a couple of years?

    I know several agents who were behind it but have been let down due to lack of account management and regular contact. You and several others are talking as if all was rosy before this happened and forgetting the sneaky £50 a month offers going round without consulting members.

    Agent support has waned massively and the public don’t care about any of this so where do they go from here to make it a success?

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  11. Trevor Mealham

    Has anyone read page 76 of the OTM trial bundle:

    http://www.catribunal.org.uk/files/1262_Agents_Mutual_Judgment_CAT_15_050717.pdf

    OTM want to charge you £1,000 pcm end game.   Reads:

    107B
    All members remain OTM + 1 and this gets us past tipping point 1 towards tipping point 2 where we are seen as strong enough for agents to begin withdrawing from Rightmove.

    108B
    End game – 15,000 branches at an avg monthly fee of say £1000 with no real need to list anywhere else. £118M income before any other revenue sources.

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    1. Woodentop

      If I didn’t know better anyone would think you have nothing but hatred for OTM. OTM is a web portal. AM are the directors, please get it right.

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      1. Frown Please

        To paraphrase a rarely seen commentor these days:
         
        i think trev’s heads gone. 

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  12. smile please

    This gets better everytime i read it!
     
    The office is wondering why i am laughing at the screen, brilliant!

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