For years EDR's product strategy has been similar to that of many other information publishers; bundle separate products together to provide a "one-stop-shopping" experience for customers. Throughout the 1990's and early 2000's, this strategy worked well for both customers and EDR. Customers benefited because they could acquire more necessary information at one time and at a reduced cost. EDR benefited because as customers chose to purchase more bundled information packages, our revenue per project steadily increased. For a while this was a win-win strategy for everyone. However, like most business strategies, I believe this one has run its course and in the coming years will gradually fade away.

When customers purchase an EDR product they don't really want that product but the relevant information contained within the product. The product is simply a pre-packaged way of delivering this information in a form that is easy to use and work with. Pre-packaged products were necessary because the technology didn't exist to automatically extract content and display it in a more useful way. Instead, the "extraction" was performed by humans who reviewed a product, determined what was important and then manually extracted the important information and imported it into an electronic work application. Today that technology is here and is being used more frequently each day.

As clients continue to automate work processes, they are making new demands on their information suppliers. These demands go straight to the manner in which information is requested, delivered and worked with. For the first time, clients are requesting that relevant content be unbundled from a pre-packaged product and streamed directly to them. But it doesn't stop with simply streaming all content electronically because not all content is equally valuable. Today, clients are also demanding that information providers distinguish between content categories based on value and relevance. Highly important information must be treated differently from "background" information that doesn't really help improve business decision making.

Business models based on the concept of "unbundling" are everywhere. From fractional ownership of airplanes and vacation properties to RSS feeds, people today can access more of what they want without having to purchase the entire plane, house or newspaper. At first glance this has been a scary thought to businesses based on the one-stop-shop philosophy. After all, doesn't it explicitly imply a lower revenue per customer? Yes it does. However, it also allows a product or service to be accessible to a larger audience.

Recently an article was forwarded to me that talked about major business technology trends to watch for. One of these trends was, you guessed it, unbundling. Besides discussing the benefits of unbundling and other trends, the article emphasized the following point:

"Technology alone is rarely the key to unlocking economic value: companies create real wealth when they combine technology with new ways of doing business."

Over the next few years, advancements in technology will force new business models in the real estate information industry. Gone will be the one-stop-shop provider of pre-packaged products and replacing this will be the information publisher capable of seamlessly delivering critical content instantly and in a way that is completely compatible with how the consumer wishes to receive and work with this content.

Much has been written lately, including here, about the recent disruption in the commercial real estate credit markets. Things have most certainly changed since August as CMBS issuances have declined dramatically (securities issued in Augusted totaled $34.4 billion but reached only $6.2 billion in October). However, as the market continues to be viewed as a global market by investors, deal flow is moving forward outside of the United States.

At EDR we have traditionally been a company that serves the U.S. market only. However in just the past 6 months, we have suddenly found ourselves participating in due diligence projects all over the globe. In fact, the total number of countries where EDR has provided some service has now reached 20. These countries include Canada, Mexico, Germany, Russia, Spain, Bahrain and South Korea. In each case the reason EDR became involved in a cross border project was because the environmental consultant used the Parcel application to author their due diligence reports.

Anecdotally we are also hearing more often that our clients are being pulled overseas to investigate properties. In most cases these clients are serving a corporation or global real estate investment operation that is expanding or diversifying overseas holdings. This activity is not limited only to the largest environmental professional firms with offices in other countries. Rather, U.S. based firms who only have offices in America are also being asked by their clients to jump onto airplanes and travel abroad to conduct Phase 1 work. The opportunity for global expansion therefore appears to apply to a large cross section of the U.S. environmental professional marketplace.

As further evidence of these changing times, one client recently asked EDR to attend an international due diligence workshop in Europe. At this event the client flew in their practice leaders from the U.S and three European counties. The main purpose of the meeting was to discuss how they were going to coordinate future portfolio projects with properties in multiple countries. The expectation here is that on these projects the quality of work and turn around times are equal to those expected on U.S. based work. Clearly quite a challenge given the availability of information and other dynamics involved with working several time zones away from home.

During an age of global capital flows this only makes sense and was to be expected at some point. What many other industries have been experiencing for years is now reaching our industry. Some environmental professionals are clearly embracing this opportunity and are already seeing the payoff.