The poker dream: The ability to make a living coming from nothing.

The industry: The people making the rules.


13 years ago Poker online was in a peculiar position. UIEGA had done it's damage, but the community in general wasn't putting much thought on it. We didn't think it could get much worse. Or we didn't want to think about it. Still having the big guys in the scene (US and, to a lesser but still very meaningful extent, .fr .it and .es) meant many things. For The industry, it meant a healthy influx of customers. They would be competing with a number of players for these, but it seemed that there was still plenty for everyone. For The dream it meant choices: bonus whoring, free starting bankrolls, supernova elite porches, you name it.


Black friday happened and the sky was falling. After rumours of another giant being the one that was going to buy FullTilt assets, it was finally Pokerstars the one that did. This meant that we were getting paid our fulltilt balances, but also meant that Pokerstars was now effectively a monopoly. During this time the Scheinbergs probably fought harder than anyone to bring poker back to the US, only to be followed by even more segregation. Tired of taking all these punches, they decided to call it quits. The company that they had built from the ground since 2001, the one that changed the meaning of customer service, was changing hands.


You could argue that the cuttings that followed would have happened regardless and that segregation and legislation was the culprit, not greed, and you would probably be right. But that is beside the point. Rake in tournaments and certain games got higher while rakeback got butchered. Casino and lower edge games were introduced, higher edge games like HU and deep tables got removed.

You can shear a sheep many times, but you can only skin it once. Without the poker dream alive, or at least standing on one leg with crutches, The industry would perish as well. And that is how, through data analysis of their player pool, they must have reached the conclusion that having, say, 6% of winning players in a certain pool was better than having 5% or 7%. To achieve this efficiency cuts were made and they raked everything accordingly.

Is this magic number the real driving force behind all these data driven adjustments? If The industry cares about maintaining this ratio of winning players, then games drying up by having less money being injected into the economy wouldn't necessarely mean less profitable games, since the rake would have to lower to maintain this ratio. Or at least for as long as that would be sustainable. But do they care about maintaining this ratio?

And what does this mean for a new poker site that wants to put an emphasis in catering to The dream. Among other things, having a higher ratio of winning players?

Mind you, this is just something that was occupying my mind. None of it is based on actual research or first hand experience in the way that The industry works behind the scenes. I'm not even educated in these things, all I know is how to poker. So that is what I'm looking for, your opinion: educated 2+2er that is still around and I enjoy learning from.

The impact that training sites had in the evolution of the games

In his latest podcast, Joey asked Galfond about his opinion on this. Phil started by mentioning that his site was far from being the first one, but what he said next is what resonated in me, an extremely simple statement that I just hadn't come up with and, to me, settles the question.

Paraphrasing a bit here but he said that, excluding rake, poker is a zero sum game and as such the act of training players doesn't take money out of the economy. If the games get tougher for some, it is because it's getting easier for others. If someone is thinking but hey, recreational players lose faster because of them. I would even argue the opposite, or at least a neutral impact. That is because the modern reg, brought up in this enviroment, may sometimes inadvertedly err on the "balanced strategy" mindset and put less emphasis on exploits that pre-solver era "sharks" had so much experience with.


The way I see it, the impact of training sites and solvers is simple: slowly switching winners from "raw talent" to "skill in understanding and mimicing strategies". As a player that excelled in that pre solver era, that is not something that puts a smile on my face. Adapting to opponents with different "styles" and coming up with counter-strategies was what made poker fun for me. Buy hey, adapt or die.

Look at the liquidity/health of the industry in the following terms:

1. Winning players who cash out take money out of the poker industry.

2. Losing players must deposit money into the industry to continue to play.

3. Absent cashouts, players do push money around the tables in a zero sum game, for which they collectively pay a services cost, i.e. rake or fees.

4. Operators pay their costs from the service fees collected as rake or fees.

(I ran a poker company prior to Black Friday, this is how poker works, whether live or online. Day in day out, with astonishing consistency, winning players captured X % of gross deposits through play, operators collected the balance and paid operating costs, including rakeback, bonus whore costs, and other marketing to retain/acquire players. The level of X shifted higher as NLHE came to dominate play.)

Im curious as to why winning players are never considered marketing costs. The front page news articles about 18 year olds making 100k a year playing poker was great advertising.

Given that games include rake his point is fairly meaningless, the argument against training sites is they equalized skill levels by raising the play of bad regs turning what was formerly money in the pockets of better regs who had figured things out for themselves into rake in the pocket of the site.

so between what range did X shift through?

1) black friday spead things up. anyone who didn't think the sky would eventually after uigea (or eventually anyway) was a complete and utter fool.younger people really don't understand what printing presses the games were back then.a lot of people making a lot of money were in fact fools and thought this would last forever and spent their money as such.

when you have any super easy way of making a lot of money- especially with one like online poker was back then- with a low barrier to entry both effort wise and financially it's not going to last.

2)galfond's point has some merit but doesn't tell the entire story.
he would be 100 percent correct of no matter what happened the same people would play the same amounts of poker. this however is not the case.as people got better, training sites became more prevelant, software advances, solvers, mass multitabling etc losing players are getting a lot less value for their money when they lose.getting destroyed in games that have no gamble to them doesn't keep people coming back for more. training sites undoubtably helped make the games worse and fleece players faster, which made them quit poker faster.i don't blame him as he was at the top of the food chain in terms of training sites. he made piles of money. the people making videos for scraps though were complete idiots.

3) I 100 percent agree with the bolded.

Which does not make much sense as pretty much nobody figured it out by himself at any time.

black friday was or is a good day for lots of pros, got out of the profession quicker than later. Being a pro poker player sucks unless you are making 100k+ a year or live where your expense is 400$-600$ and you make 30k

random accountant wins a few million in the wsop main event off of some 30 dollar satellite is great advertising.
18 year old gto nerd running solvers wins 100k 12 tabling or whatever is not good advertising.

Good point

I don't understand the hate for solvers. Solver play is far from nitty by the way. Also now poker is more than ever results=directly correlated to how much work you are willing to put in, what's more pure than that?

Best gto players making well over 100k a year even at stakes under 3/6 stop the malarky.

Giving some random dope a prize doesn't really differentiate poker from any other casino game. When I started playing poker, I started playing because I could win. No mathematically literate person thinks that they can beat a slot machine. It's literally burning nickels on every....single....pull. A poker game though, there is a set of people who have lived off poker for their whole lives. If I'm going to play a game, I want to be able to have the possibility of winning and poker pros are the proof.


I think you're seriously discounting the national news segments and the articles in the WSJ and nytimes about not winning a prize but making a living playing poker. Advertising is about eyeballs and poker pros draw them. I mean Full Tilt's full business model was to "play with the pros". Pokerstars is literally named Poker "Stars".

To take the chess analogy, Magnus Carlsen sleeps with his solver and his domination generates media attention. Solvers aren't inherently uninteresting or evil. In fact the play with them is substantially more entertaining than some of the more nitty varieties of professional bumhunter that came before.


What doesn't draw attention is playing on a set of sites that actively dissuade people from making money, because 99% of deposits should go to the site as opposed to 95%. It seems like poker operators like to forget that poker pros are the differentiation between a completely rigged casino game and a chess hybrid that happens to be played for money, (with still absurd margins for the house).

quicker you bring everyone to equilibrium its the quicker the game/edges and money dries up and doesnt exist anymore. Fish dont have unlimited money to deposit and if it becomes where they need software 10x the amount of study to play time and all these other caveats just to exist in the game then theyre never going to do that and youre left with nothing but solver nerds and no money to be made. training sites ruined the longevity of the game. humans would have gotten better and figured things out but it would have taken way way longer. HUDs are absolute trash for the health of the game too. you shouldnt have real time access like that. you dont have that live and its destroyed playability in games.

how exactly does this draw in the players you want to be drawing in?

chess is super pure. there is no luck involved. no money in it either.solvers are not good for the game at all, but they exist so people need to adapt.

i also hardly consider people running all kinds of software while they play to be pure. it's the exact opposite of pure. what's pure about tracking people's play, using software to break it down and exploit them? nothing. what's pure about seat scripters? nothing. so like i said people need to adapt but online poker is far from pure.

bolded 1- there is almost no money in chess
you're making my argument for me
hard for chess experts to buy things with this almost non-existent media attention

bolded 2-

this is an absolutely comical and delusional statement.
many poker pros think poker revolves around them and it doesn't.this attitude also leads in many cases to the poor treatment of fun players, and players thinking these fun players who are crushing life are idiots.

many poker pros also forget sites/poker rooms are running a business. poker revolves around losing players. poker pros don't legitimize poker at all. if every single poker pro died tomorrow poker doesn't magically become a "completely rigged casino game".

btw all winning players are not poker pros.

For a young dude with no training/education and is looking at humping a **** job which numbers en mass in the US... this is great advertising. 2+2 used to be filled with people that was dragged in with the 100k a year dream just by grinding Pstar SNE.


Most people make what like 40-50k doing ****ed up **** that they hate. The only problem is the reality of being an online poker player and that tiny shelf life/opportunity. Making 100k nitting it up is a dream job for the young and for many olds lol, only problem is you have to be a online poker pro.

I'm talking about studying with solvers, you're talking about something completely different and going on a nonsense tangent, as per usual. The marketing + side to it is that if you are willing to work hard and have around atleast avg intelligence/work ethic= you will make money playing a "game".

By the way I study with solvers and have hardly looked at a hud in 10+ years, lmao.

Borg is just a mad hurt losing/breakeven player that can't adapt to todays games. That's pretty obvious. Just put more work in man you will do well, period.

]

1) Define no money. Carlsen likely makes more than any poker pro and will for the next decade.


2) I'm just not dumb enough to think that 99% of $1.00 > 95% of $1.05. If even 1 in 20 dollars are deposited because the pros are proof the game isn't obviously rigged then, voila, more money!


3) So in your opinion winning $50 month is alright, but $1000 a month is too much (depends on country)? Or should the max winning players be allowed to win is 1 cent?

Finally, the poker sites make money by people playing poker. No more-no less. Some players win and some players lose. The old PokerStars had a monopoly based on this model. A MONOPOLY.

Amaya have this idea that "only losing players" make them money. Their poker vertical is now 1/2 the size of the business they bought 6 years ago! I can't think of bigger repudiation of the only losing players model. If you bought a restaurant that served 100 people a night six years ago generating a $10,000 night revenue and now serves 40 a night and generates $5000 a revenue, you'd be considered a failure. It's only through the other verticals and their mergers that Amaya still exists.



Just a small thought experiment but if you put 10 losing players at the table, 1 or 2 players would win. Let's ban these players because they are leaches. Then we have 8 players, 1 or 2 of those players have to win. Let's ban them too. Now we have 6 players, we still have winners, so we ban them too. Finally we have 2 players and one of them wins. Ban him too. Now WE HAVE NO GAME.

Strangely, some players are better than others at poker. That's game. People like to play it. People have made fortunes running straight games with fair rake and not picking favorites.

10th

Fully disagree with Galfond. Bringing more intelligence into the poker community discourages gamblers.

In an ethical sense the influence of his enterprise would then be very good. As it would be morally very good to make people smarter so they can make better decisions, for example: not playing poker when playing a 100% losing strategy.

There is some money in chess - just not for pro players (with the exception of a very narrow group of 10-20 top guys).
Who makes money in chess:

-World Champions (basically once you win it not only you a significant price fund but your name is worth enough that you will always get invites to events/lectures etc.)
-streamers/youtubers (a number of them make low/mid 6 figures out of youtube/Twitch alone)
-edu-enterteinment software companies: Chessbase is a big player, engine makers used to make money but not anymore due to very strong open source community projects)
-content makers (a lot of them not remotely strong enough to be pro players but good at producing entertaining/educational content people like and pay for)
-training sites (Chessable is the biggest player right now)
-coaches: nothing crazy but if you are a GM, you speak English and can market yourself just a bit you can get 50$-100$/hour - you can make decent living out of it especially in low cost of living countries

Carlsen of course makes bank as not only he is the biggest name and the strongest player in chess for more than a decade, is a celebrity in his country with a dedicated TV channel showing his games, he also owns a significant % of chess24/chessable/play magnus company.

It's not very surprising that there is more value in an entertaining streams/content/videos than in 100th and 101th ranked Russians battling each other even though those guys could give a blindfold simul to 10 streamers who make more in a year than they will in a decade.