Why open ecosystems are key to CRE value creation

Plumbing. It’s not sexy and we only think about it when something goes wrong. But without it, we’d be up to our necks. (I probably don’t need to finish that sentence!)

Plumbing is an essential infrastructure. And, for the most part, it is agnostic. It doesn’t care which toilet, sink, or shower is connected to it. Good plumbing, an electrical grid, or an internet fiber network, are essential for modern living and enables people and businesses to get on with their lives and do interesting things.

But imagine a plumbing system where you had to buy all the taps, toilets, sinks, and so on from the infrastructure provider. These devices then limited water to flow in certain ways at certain volumes as the provider deemed fit to optimize which of their devices you purchased. And anyone who came along with a different piece of plumbing infrastructure to add or improve things was locked out of the system? Seems crazy, but that is exactly how closed-tech ecosystems operate.

Closed systems are very profitable for the older tech platforms that own them and their large captive customer bases (you). Building walls, charging costly admission fees, more ongoing fees to stay, forcing both parties in a transaction to use the same technology, and selling very expensive customization services are great ways to make money. It also is a great way to spoil the experience for the customer.

I’d argue that closed technology platforms are the death of innovation and do little to move an industry forward. Conversely, open technology ecosystems are critical for the creation of value and innovation. Take two technology ecosystems we are all familiar with: Apple’s iOS, which powers iPhones, and Google’s Android operating system, which powers Android smartphones from a range of manufacturers. Neither Apple nor Google develops every single application that runs on your smartphone. They develop some, for sure, but then make their operating system available for other developers to plug in and develop their own apps quickly, easily, and safely. Whether that is Meta with Facebook, Instagram, and WhatsApp; your bank’s mobile banking app; or a startup doing something brand new (that’s how WhatsApp started out after all). The innovation that has emerged ranges from lifesaving, such as healthcare and emergency apps, to the fun and frivolous like Angry Birds.

To bring this back to our plumbing metaphor, Apple and Google provide the plumbing infrastructure and allow other members of the ecosystem to take these capabilities and build something new. This is important because even companies as smart, big, and wealthy as Apple and Google could not possibly come up with all these novel ideas. Nor do they have the capacity and inclination to, for instance, build banking apps for every bank on the planet.

But they enable and amplify this innovation and creation of additional value through the openness of their respective ecosystems. This is good news for the end-user. They get choice, customization, a range of price points, and an app for almost anything. No matter how niche or specialized, there is an app, because their ecosystem is so large and open that there is sufficient revenue potential for someone to build it. At its very root – open ecosystems are no different than capitalism. They enable choice but letting people vote with their dollars. And the ecosystems are great for the providers because their customers love their platform and tell their friends, and spend countless hours each day using it because of the wealth of services it provides.

It’s no surprise that for us, open technology ecosystems are the way forward. It’s baked into our DNA – “just the facts” has long been our corporate mantra. And today we are excited about the opportunities that true cloud computing brings to drive open technology ecosystems. Data empowers markets to grow, and if, through the accessibility and flexibility of our cloud-native service, more ecosystem partners can do more interesting things to drive value in the CRE industry, “just the facts” are really going to be given superpowers.

About Rockport VAL

Rockport VAL is the long-awaited market Alternative. Rockport VAL provides CRE valuation and discounted cash flows. VAL is user-friendly, affordable, powerful, and connects easily to your tech ecosystem. It’s cloud-native (it was created in the cloud), so truly offers the capabilities the CRE industry needs for the future.

Click here to Book A Demo today.

About Rockport 

Rockport provides a SaaS platform for all facets of the commercial real estate life cycle. Founded by Rick Trepp, founder of Trepp^®, Rockport has been a trusted partner for systems & digital infrastructure to the largest CRE players for the last 20 years.

Learn More.