I think lowering rake to a calculated point would be hugely beneficial for the growth and sustainability of online poker and ultimately for the site’s profits in the long run. The reason poker is so popular/attractive is because it is a beatable skill game, viewed by many as a sport and anyone can win. It’s addictive because it is very tough to know if you are the winner or fool, which is why I think it’s so important that the industry sets its prices to result in:

1. A notable proportion of *average-skilled players going on heaters over decent samples

2. Evidence the games are beatable by a notable number of players equating to a desirable pro image

* average-skilled meaning player of average skill level

The effects rake has on variance

Player skills are relative, but the key to sustaining healthy games that contain whales and gods (the minority) is to retain a good customer base of average-skilled players (the majority) in between keeping the games running and churning rake. This is achieved by keeping the av-skill players blissfully unaware of their losing edge to the rake over a decent sample by fulfilling the 2 points made above. This is far from the case at the moment and the graphs below show the effect current rake prices are having on the average-skilled player.

To illustrate this point I am using these parameters and stats:
- Decent rec and reg sample size over 1 year
- Standard Deviation is 80bb
- Rake inc. rewards @ low stakes 7bb/100
- Winning player wins at 2bb/100

Effects of current rake produce <1% winners among average skilled players and winners experience huge variance over 1 year sample:



With a 43% reduction in rake, theres a huge increase in the number of average-skilled players now profiting, >10%, and winners have more desirable variance over 1 year sample




With an 85% reduction in rake, it is virtually indistinguishable how many average-skilled players profit vs lose, even by looking at this graph, and winners variance is well controlled and solid over a 1 year sample.



I understand that the large majority of poker players have to lose so that sites and skilled players can profit, and individually this isn’t a problem, but when >99% complain they never win, rarely go on heaters, and most good winning players suffer huge variance with some breaking even over a year, this seriously harms pokers image and fundamental attraction for beginners to the game, and rake is becoming a more prominent factor as skill levels converge

I’m not suggesting sites cut their prices by 85% but 1 look at these graphs and it’s obvious that a change in rake would make a huge difference of how online poker will be viewed and discussed by the masses, it would keep average-skilled players far more in the dark of their true edges and winners with a great image, to me it looks like there is a tipping point that can make the difference between a sustainable/growing industry and a passing trend and I’m not 100% sure sites give a fudge because their bottom lines for this year look great, and if poker could’ve taken off as a mainstream sport, they’d never know.

Thoughts? Actions? Picket signs?

needs some more standard deviation charts.

well done

Ive always agreed that the rake is way, way too high but Im not too sure what I can do about it

I think the rake/VIP rewards in general should be cut by 66% because raking 3$ in a 60$ pot just isnt right. Same for those 10% mtt fees, this is an absolute joke.

I agree rake is the absolute problem of the poker economy as we have it.

I do not believe that reducing the rake is the solution though.


The problem to me is that all the rakeback goes to pros. On stars 70%. Instead this money should go to the fish.

The fish should get lots more incentives and free money even. Bonus makes no sense for beginners and fish.

Instead of feeding the shark directly we should feed them with more fish by increasing the bankroll of the sharks we should add more fish bankrolls are give the fish more free money.

I also disagree with the fact that fish should pay rake at all. I think they should get 100% rakeback in form of things like the ring game tickets or free tourney entries.

I ran some numbers myself and published on my blog. It's on blogspot with same nick as here.


In essence: rake is relative. 5% rake does not mean good or bad. It's dependent on how good the games are.

The problem is not the rake but the fact that 50% of the money won is raked.

Instead of rake regulation we need regulations that rake may never be higher than x comparative to money won in game.

do it right yo

A suggestion myself, and others, have mentioned is to simply do away with per-hand rake to a system that doesn't change the score of the game as it's being played. For instance sites could charge a rake on withdrawals inexcess of deposits. What I mean by that is a casual losing player who deposits $10,000 and finally binks a $5,000 tournament score isn't going to get raked on that $5,000. In essence only winners get raked.

One thing that I think is overlooked is how hugely negative an impact the rake has on casual prerake slightly losing players. Consider a player who would normally lose at -1bb/100 prerake. He hops into a lowstakes hold'em game online and is suddenly paying 10bb/100. Casual players, and many regs, may not really appreciate exactly how damaging the rake is but anybody is going to realize when they're losing 1000% faster than they're used to. Money that might last him a month at his homegame (which is madeup of relatively comparable opposition to what he's facing online) suddenly lasts him a weekend online given the same number of hands?? He's going to blame cheating, rigging, whatever else. He's certainly not going to blame those few cents to couple of bucks the site drags out of the pot each hand - but the result is the same. He's not going to stick around. The system I suggested above would completely fix this problem and start to help depolarize the skill levels in poker. Right now only very good players who can beat the rake and very bad players who don't really care how much they lose tend to stick around. The middle class, which is presumably the majority of players as in any zero-sum game, are the ones most hurt by high per-hand rake.

This would also suddenly completely align the interests of the players and the site. Right now it's in the sites best interest for there to be no big winners or big losers for that matter. They earn the most when everybody puts in tons of hands but nobody earns anything - a terribly unenjoyable situation for all players. When the site makes their profit by having winning players suddenly they have the exact same interest as players do.

Suddenly regs can play against other regs with the expectation of one player actually being able to come out a winner. The reason consciously intended (as opposed to incidental) reg vs reg action is so rare at low and middle stakes is because neither player can ever really expect to be able to realistically win. Poker is a game of small edges and the rake is anything but small. When you're facing a competent player the only 'person' who's going to come out a winner is the house. The suggested system would solve this and ideally even start to work out some of the problems we have of excessive predatatory activity, bumhunting, etc that is so hurting the games today. I love playing against regs, yet I actively table select simply because I know there's no point playing regs when I'm paying 5, 10+ bb/100 in rake. I may as well just save my time and write a cheque to the site.

I could go on about various pros of the system forever. But there's one another crucial part here in terms of its plausibility. This idea doesn't necessarily dictate the site losing money. They could work to charge a fee that would result in comparable profits to what they see today! It's win win all around.

EDIT: Ok, I have to rave about one other pro of this system. The impact it would have on poker's image. Right now if you ask most of anybody about online poker you're not going to hear anything besides negatives: the sites are rigged, players cheat, the sites will steal your money, blah blah. That will invariably be met with a knowing nod or ten from anybody else within earshot. But poker is a zero sum game, in a world where rake is only charged on winnings you're going to have an enormous amount of winners. Given there are more huge donator outliers than huge winning outliers and with the middle all being of fairly comparable one can only imagine how high that exact percent would be. The image transformation, and resultant impact, that would cause in online poker cannot be overstated. It would turn the image of the image of the game around effectively overnight. Imagine if at a homegame when somebody invariably brings up online poker instead of bemoaning the rigging and cheating people end up using to explain their losses - the topic of discussion flows towards what players are doing with their winnings.

Goof stuff, hope this gets some attention.

Could not agree more. Correct me if I'm wrong (its late here) but would charging players in profit a fixed % withdrawal fee instead of ongoing charges from pots = recreational players experiencing rake-free swings/heaters at the tables while skilled players ultimately pay the rake out of their longer-term winnings? That would be amazing for the games!

This idea has been discussed in another thread. The issue with going from a table-rake model to a withdrawal-rake model is that (assuming the site wants to keep raking the same amount of total money) it shifts the rake burden heavily away from mediocre mass-tabling grinders and onto higher-winrate players who are playing fewer tables, which will probably just encourage more nitty 24-tablers to take over the games.

There's also the issue that fish are generally blind to table rake, but if you charge a fish 50% of his winnings in rake when he tries to withdraw, he'll probably throw a fit and never deposit again.

Great post OP, found the graphs interesting! Obviously lower rake would be sick, seems a long way away though with a sort of monopoly developing at the moment.

Not in love with the idea of raking on withdrawals though, rec players would see it as some sort of scam if they ever had to pay to get money off the site imo.

Very interesting read. I wonder what percentage of players actually stop to consider the effect of the site and level they play on has on their winrate.

All the standard advice is about having a certain amount of buyins per level etc. People naturally assume that their winrate will drop as they move up, assuming their skill level doesn't increase.

I'm sure very vew people consider the rake at the different levels in their decision to move up. I don't have numbers, but lets say I only play 10nl becuase my winrate is x, and I think it would drop to y which might be breakeven or even losing at 25nl. But if the rake is proportionally less at the higher level in terms of bb/100, and you get a correspondingly higher rakeback bb/100 as a result of generating more points ... could you actually be doing yourself a disservice by staying at a lower level?

I think you need to contend with taxes for winning players as well- this will be a pretty big issue when online poker is legalized in the US

maybe u should just play better

Ban NL, make everyone play limit would make the poker ecosystem more sustainable.

Op you pay so much in rake BC you play so many tables
Poker will never be sustainable with fish playing 1 or 2 tables and nits and good players playing 12-24.rake back pros getting 70+ % rake back is terrible for the games.people who cause action to dry up shouldn't get rewarded for it.if sites want long term sustainable games they need to run ethical sites,where its easy to deposit and withdraw and the nit/shark to fish ratio isn't out of whack.sites could lower the rake and a few months later new more advance software would come out that let people play 50 tables at once and short sighted players will be begging the sites to let them play 50 tables.and a year later you would be complaining about how high the rake is and how bad the game quality is.

The sad thing is we have this discussion on 2+2 every week, but the sites don't care. So many good points have been brought up, but I've given up that it'll make a difference.

Absolutely. Black Friday left me personally in a situation where I went from playing $200 and looking to establish myself at $400 again to grinding the micros to work my way back up. It's amazing how much better the microstakes had become since I had last played them. That experience is actually one of the things that lead me to become so proactive regarding rake issues. It was extremely nontrivial working my way back up - as a winning player at stakes 10x as high! It was eye opening as to why there is little to no actual money moving up the stakes anymore. The games down there are not just donkfests anymore and they're being raked 10+bb/100 in NL and 20+bb/100 in PLO.

That's horrific for all players. Those players playing those games because it makes them nigh unbeatable for players who are that skill level that 'ought' be playing those levels, and it's terrible for players playing higher stakes simply because instead of any money trickling up the poker economy it all ends up getting raked away by the site. That in turn leads to a general toughening of higher stakes games as the weaker regs drop off and head back down further increasing the dififculty of those games and leading to a vicious cycle that seems to have already lead to unsustainable games.

The gist of that is that while there is still quite a skill increment as you move up the stakes, but it is rapidly decreasing while decrease in rake burden is more or less the same as it's always been - big. That said, I would not be at all surprised if Stars in particular tries to start further increasing the effective rake paid by mid and high stakes with their new VIP/rake changes which will be announced next month.

The sites don't care and the players are even greedier and more short sighted than the sites

Plan B

A time charge instead of rake. Each player has an individual clock that starts when he sits at a table. A small charge is deducted from his off-table bankroll (unless all his money is on the table) and then every 1/10th hour after that.

In most cases, all the money on the table stays on the table until a player leaves. Unlike the current system in which some money (rake) is removed from the table after most hands.

Rake taxes betting and raising. A time charge encourages betting and raising.

The current online sites are dying. Stars is down about 10%. The smaller sites like iPoker and Party are down roughly 30%. This after years of rapid growth, and the decline seems to be accelerating. But far from doom and gloom what I'm getting at is that the current sites have two options: change or be replaced. Either way the issues of players will end up being given their due consideration.

This is by far the fairest and most logical way to charge players
In addition to the fact rake back grinders get a higher % of rake back than fish they also pay less rake per hand dealt since fish win a disproportionally higher percentage of pots.

How to run a sustainable business by random basement cheeseburger dwellers and internet degree business people from 2p2. Anyone with a REAL degree here? Dont really want to read TL;DR's by a 3K poster that actually has no clue about the different factors in running a company.

How would a timed rake equivalent work online? As in fixed rake paid per hand dealt, fished rake round, per hour, etc..

* didn't see this was posted already

This would help deter players from rakeback whoring

The Merge games were tight but barely beatable at 50NL and 25NL pre-Black Friday. I stopped playing on the site a few months before Black Friday and I have looked at the games since and I have noticed that 50NL hardly has any full ring games running anymore. When this is happening this means nobody is winning because the few fish that played in these games have tapped out and moved on. 25NL still has 6 or so tables in the evenings but eventually this will die too. The future of online poker is bleak with huge rake and greedy policies of sites and Merge has among the more generous bonuses and rakeback for players.