SAN FRANCISCO –OBSNews- The real estate market in the US is in the midst of a historic transformation. Everyone who reads the news about buying and selling a home in the country is aware that prices for homes in many areas across the nation are falling as a result of the bursting of the housing bubble. Real estate industry watchers also know that the migration of real estate data and advertising towards the internet is creating deep unease and falling profit margins among newspaper businesses which are frantically struggling to reinvent themselves in the world of interactive media.

But there is another sea change that is occurring in the world of residential real estate and it portends ill for real estate agents and brokers accustomed to doing business in the old-fashioned way. According to the National Association of Realtors more than 80% of prospective home sellers and buyers use the internet when they look to buy or sell a house. Users of online real estate tools will often then work with an agent they know personally, but they are just as likely to reach out for professional help via the companies they interact with on the web.

What this means for the ordinary real estate agent and the traditional real estate brokerage companies is an era of new marketing alliances. In many cases, what was once a fierce rivalry between online marketers for real estate and the old guard has now become a mutually beneficial relationship with the technologists on the web finding and partnering with agents who have specialized local knowledge and industry experience.

Below are some of the leading internet real estate companies.:

1. www.RealEstate.com – Barry Diller’s Interactive Corp. (IAC.com) via LendingTree.com owns this site and late last year moved to create local real estate offices designed to compete with the Century 21® and RE/MAX® traditional brokerages.

2. www.TheHomeBuyingCenter.com – This company provides home sellers with an opportunity to sell a house directly to a real estate investor. They also help home buyers find low-priced deals on houses in foreclosure and on bank-owned properties. They also refer home sellers to real estate agents and brokers across the nation to help people sell quickly when the houses do not meet their investment criteria.

3. www.HomeGain.com – This site is owned by Classified Ventures, a strategic joint venture of several large media complies (Belo Corporation, Gannett Company, The McClatchy Company, Tribune Company and The Washington Post Company). This site attempts to be an online matchmaker between sellers and buyers and real estate agents.

4. www.Trulia.com – This site is residential real-estate search engine that offers real estate information such as homes for sale, house listing and sale prices and market trends. Trulia is advertising supported.

5. www.Zillow.com – Zillow provides an estimated appraisal value for homes across the United States and provides a forum to homeowners, home buyers, and agents to create discussion groups. This site makes its money from selling ads on it heavily trafficked website.

6. www.Terabitz.com – This company provides yet another free service for real estate consumers. They attempt to aggregate large amounts of information about residential real estate that includes local neighborhood information, market research, schools, restaurants, crime and safety statistics, service providers, financial tools, and more. They make their money from targeted local advertising.

7. www.Redfin.com – Currently serving just seven major real estate markets across the US, Redfin is an online discount real estate broker that they describe as half electronic and half personal. They employ real estate agents directly and claim to rebate commissions to home sellers and buyers thus making their services cheaper than traditional agents and brokers.

8. www.Craigslist.com – Even though the by-now-classic website does not make money via real estate advertising, thousands of houses for sale and apartments for rent are listed in many different cities across the country. Craigslist has been a major reason why newspapers have been forced to re-tool their business models that once depended primarily on real estate and automotive classifieds for revenue.

By Michele Gershberg

WILMINGTON, Delaware (Reuters) - As a legal battle between Barry Diller and John Malone headed to court on Monday, the biggest surprise may just be that two of the media industry’s largest personalities have let their dispute get this far.

IAC/InterActiveCorp Chief Executive Diller and Liberty Media Chairman Malone are fighting over the future structure of IAC under a plan to spin off four of its largest units.

Long-time business partners, their relationship turned bitter when Diller proposed a structure that would dilute Liberty’s voting control over the spin-offs.

Both Diller and Malone are known for their strong wills and complex deal-making, but people who have followed their business dealings are surprised they were unable to settle their differences before the trial in Delaware Chancery Court.

“Diller and Malone have had a relationship for 20-plus years,” said April Horace, an analyst for Janco Partners who has long covered Malone’s Liberty Media. “Malone usually negotiates something … It does surprise me that this particular time he has not been able to.”

In the meantime, IAC’s outside shareholders continue to see their investment bleed value over fears that the spin-off will be delayed, Diller will be ousted or IAC will be forced to swap assets with Liberty at a lower price to end the dispute.

IAC shares have slid 21 percent since the two companies sued each other in late January. At least two shareholder lawsuits have been filed against IAC’s board, one of them also naming Liberty Media.

“I think the stock is worth $40 and it trades for $19.50,” said one IAC shareholder who did not want to be identified due to a company policy on discussing holdings. “It’s just insane unless you think you’re going to get completely screwed by Malone in some form that you can’t even dream of.”

Sanford C. Bernstein analyst Jeffrey Lindsay still believes the spin-off plan is the best possible outcome for outside shareholders, but he recommends waiting until some white smoke is visible from the proceedings in Delaware. While IAC shares are cheap at this point, they could represent a value trap.

“We can still see downside for IAC investors, especially if a value exchange is made to persuade Liberty Media to forgo its super-voting rights,” Lindsay said in a note to clients on Friday.

Diller moved quickly to calm nerves at the company. “At the end of the day, it’s purely a business dispute,” Diller told employees in an internal memo originally posted online by digital media blog paidContent.org. “We are highly confident in our legal position and are looking forward to proving our case to the judge.”

HSN SWAP

Malone and Diller had long discussed a potential swap for IAC’s home shopping network HSN, and possibly other assets, in return for Liberty’s stake in IAC, but were unable to agree on the proper value to ascribe to the assets. Liberty holds about 30 percent of IAC but controls 62 percent through a second class of super-voting shares.

What they have swapped is cutting remarks since the legal battle began, with Diller at one point referring to Liberty executives as “insane” and Liberty accusing the former television and film executive of staging a corporate coup.

Even though back-channel talks continued in recent weeks, the two sides remained far apart on how to reach a settlement, a source familiar with IAC’s thinking told Reuters last week. As of Sunday night, no imminent agreement appeared to be in the works.

“John is like a big cat in the Serengeti. He’s pretty fierce and he can lay in wait for quite a while for his prize,” said Mark Robichaux, editor of industry trade Broadcasting & Cable. Robichaux wrote a biographical portrait of Malone in the 2002 book “Cable Cowboy.”

But by taking their battle all the way to court, both stand to lose at least part of their demands, Robichaux said.

Liberty is unlikely to prevail in its request to oust Diller and six of his close associates, including wife Diane Von Furstenberg, from the IAC board, while Diller may not be able to go ahead with the spin-off without a major concession to Liberty on price or control.