It still makes no sense how you can take a larger percentage of winnings, regardless of the sample rate and be good with that. At my given 1/2 game, the maximum I'm ever raked is 10% and that is only if I never win a pot bigger than $40. Any pot bigger than that and the percentage goes down.

Thinking out loud here, let's use the bb/100 ratio. Let's also assume I win 100 hands in a row by some miracle and ever one is exactly $40 pots. So I get $36 and the rake is $4. That would be $400 in rake and $3600 to me. The bb ratio would be what, 200/100? 200 big blinds over 100 hands? Is that right?

I guess I'm not seeing the point. I still only pay $4 per hand won at a max of 10%. How is paying more than that better?

@gargamel.... tbh even though the posters who are responding to you dont even know that they are agreeing with you they are doing just that.... the difference is that the guys here are proposing that lowing rake(cutting into stars bottom line) & giving more back to the players while maintaining $ spent in promotion is better for the long term health of the games

they basically are saying they think pokersites make way too much $ & they want more

what is best for the long term is definitely what is best for the pokersites bottom line, pokerstars has a monopoly & it would just be stupid for them to lower rake currently

p.s if we want lower rake then we need to influence the high stake pros to pool together & cr8 their own business model to compete with these pokersites, till then all we will do is complain

The avg. winning player gets raked over 50% of what they win.

For me personally it's like 80-90% at FR. ( I play 50nl). So when I rake 100 I win about 10-20.

There are plenty of games where I am a loser only due to the rake. Which is why I can't move up.

Just shows u haven't read this thread.

why is this thread 5 star? has anyone done anything other than pseudo-maths and unsubstantiated theorizing?

Nobody said that.

As of facts, I haven't seen any from you.

I have run a few million hands and wrote a blog about the facts and posted them in this thread.

Rake is indeed extremely counter intuitive. The big issue you're missing here is the concept of the long run - something critical to improving at poker. At the minimum you need to think of things in terms of sessions. A typical session is something like this:

small win
small win
medium loss
small loss
small loss
big win
big loss
medium win

So forth and so on.

Over any meaningful period of time you end up wagering a large amount of money, but your profits relative to the amount wagered are tiny. For instance a winning player may wager a total of $100,000 and profit something like $3,000 pre-rake. Enter a 5% rake and he's paid $5,000 in rake and... well you can see where this is going.

This is why successful players tend to focus on things in terms of bb/100. Over a large sample it can give you an indication of what will likely be expected. So for instance low stakes PLO online is raked around 20bb/100. This means if you beat the other players for an edge of 20bb/100 - you are a breakeven player. If you beat the other players for 19bb/100 - you are a losing player. In fact this very phenomenon is exactly why many weaker players likely feel online poker is rigged. 19bb/100 is an enormous edge in poker. It means you are regularly outplaying your opponents, getting it in good and holding, so forth and so on. Yet in online low stakes PLO - you're still a loser with a 19bb/100 edge.

So the reason a rake on winnings is more desirable than a rake per hand is that any edge would allow players to play profitably. If you can beat your opponent for 1bb/100 - you can keep playing him knowing that in the long run you'll be able to show a profit. In today's games that's not possible and players are forced to seek out incredibly weak opponents just to overcome the rake. As has been mentioned that is why more and more players are leaving the major sites and playing on smaller sites where there are fewer regulars. This is all a direct consequence of the rake. This isn't good for the competitive aspects of online poker, and it's certainly not good for the weak players who become little more than sustenance prey for better players.

I realize this is a mountain of text and I think verbosity and bull**** tend to go hand in hand, but I really did not want to leave anything out as this is a very counter intuitive issue. Hopefully this goes a way towards explaining why when given a choice of a 10% per hand vs 30% on winnings system most of all players would stand to substantially benefit under the latter?

You can also think about the rake relatively. Consider a homegame between 6 people who are all pretty close in skill; maybe one player is a bit better than the rest. If you put those 6 online they're not only all going to become losers (small edges mean you cannot win enough to overcome the rake) because of the rake, and they'll all lose their money *much* faster. Drop them in a low stakes PLO game and the site is taking 120bb/100 off the table in total (20bb/100 per player). That means in 500 hands every single penny on that table is gone - raked away by the house. In today's rapid-deal game those 500 hands could happen in a matter of just hours and bam - all the money's gone. That's not much fun for anybody, well I guess except the house - at least until they have no players left as they've raked them all to death.

In a profit model where the site generates their revenues by charging a fee on withdrawals then the play for those 6 players online would be identical to how it would be playing in their rake free home game. Their money would last as long as it normally would, break even players would be break even - small winners would be small winners. The only difference would be when it came time to withdraw. The winner, assuming he was a long term winner, would be charged a fee on any excess winnings. He'd go home a bit smaller of a winner, everybody else would remain exactly the same.

Guess I don't. How is he paying on what he wagered? The rake comes off the pots he wins, the $3000, not what he sits at the table with (unless it is a timed rake). Assuming a 10% table rake, he'd pay at most $300, but most likely less.

He pays rake on gross winnings, not net winnings.

Sites rake at a rate they think will maximize their profits. They won't reduce rake unless they think it will increase their total profits in the long term. They would rather use the money on promotions than giving it back and this strategy seems to be working so far. I doubt many people ITT ever worked for a poker site's marketing team.

I find this thread to be very interesting. There is much more beyond "lower the rake".

Ahhh! As Adacan stated you pay rake on his gross winnings - not net. The system I am proposing is exactly what you seem to be in favor of - essentially payment on net winnings. Take a very basic example of a $100 coin flip with a 5% rake, you win twice and lose once.

You flip for $100 and win. $10 is taken from the $200 pot. Your net gain is $90.

You flip for $100 and win. $10 is taken from the $200 pot. Your net gain is $90.

You flip for $100 and lose. Your net loss is $100.

Your net result is $90 + $90 - $100 = $80. Yet $20 was taken out in rake. In an unraked game you would have earned $100. How quickly that 5% rake has quickly turned into a 20% rake!!

My position is very simple. Let the sites keep their profit but stop changing the game so much while collecting them. I don't think the site should be turning so many small winners into losers, small losers into huge losers and so forth when there are reasonable alternatives that allow them to continue with their huge profit margins without so negatively impacting the game.

Ultimately I think the key to long term success is to have fun games. Randomly deducting huge amounts from the 'score' of a skill based game while it's being played isn't fun for anybody and the games are clearly suffering as a result. The sites are trying to 'subsidize' this problem by convincing dead money to continue depositing but that's little more than throwing a bandage on a severed limb. It's not a sustainable or realistic solution.

Can somebody who is a little better with numbers estimate how many players of the current player pool (percentage wise) has to stop playing before it becomes immediately profitable for pokerstars to use the 30% on winnings system instead of the current rake system?

Assuming the players who stop playing now return to play under the new system..

I know it depends.. what limit, how many hands they play etc. but just a rough estimation is needed.

For the sake of the question we can also assume there are 100 000 active players who all play $1/$2 no limit and all play 10k hands per month.

the only ones who think that current rake is beatable must be massive bumhunters or sne players

+1

and to add something, if you think that searching for 80 vpip donk to play profitably can be considered poker, then you are wrong. You win money, but thats not even close to what poker should be - a game of skill. Skill is not measured when you play the worst, it's when you play the best you use your skill. And when you lose 10bb/100 just from being present at the table there is not much room left for the skill, unless you wanna compete in "who lose less due to rake".
Oh and here is some ridiculous suggestion, rake bumhunters more and regs who play regs less and put that rake from bumhunters into reload bonuses for those who are losing = bumhunters take less from economy, fish reloads and is happy, regs can play regs.

I think the maths is correct - players would certainly profit more from 30% winning system than 10% per hand.

However, the logic is not.

What you are effectively proposing is that from net depositing players losses, the poker site keeps 30% and the winning players keep 70%.

The poker sites costs include:

- Payment processing costs (e.g. 3% on all moneybooker deposits) and payment and fraud team salaries

- software licencing/building/development costs

- marketing costs such as banner advertising, tv advertising e.g. sports tv ads for bookmakers, magazines, marketing team's salaries to run this

- design team costs to build images for all promotions and website updates

- risk on affiliate deals such as CPA deals that could go wrong

- salaries for all support agents and other roles such as those sending the newsletters out and analysing the results

- much more e.g. content editors to build and proofread the new promotions, including t&cs, text message guy to decide analyse effectiveness of sending text messages for balance reminders etc


Whereas, the winning players costs include mainly the time to play.


I think in reality the split would need to be far more in the region of 70-80% in favour of the poker site for this to be a viable proposition for the poker site, which would turnoff any cash game poker player.

I do not have the figures of what % of net losing players ends out going to the site in rake, and how much is withdrawn by winning players, but I'd imagine it is around 70-80%.

What you are effectively proposing it to say let winning players keep around 70% of the losing players net deposits, rather than around 20%-30% that is now. Clearly, this would be a big cost for the poker site.

This is short sighted I think, if you kill the poker site's margin they will cut back drastically on all marketing efforts and they will be less players entering the poker economy willing to lose, which is where both the site and the winning players make their money.

What we do need is:

1) poker sites to re-build the software to be far more fish friendly (at the moment most software is hugely geared towards grinders)

2) poker sites need to focus on fish friendly promotions

3) poker sites needs rewards affiliates based on the fish they bring in, not the grinders.

We are seeing progress in all 3 of these areas, though it is, and will, take time.

I am one of the optimists on online poker, I think once poker sites have implemented all the 3 areas above, then they will see a much better ROI on marketing costs, and so we will see an increase in marketing spend.

agree john_kane. Many of you seem to think that pokersites have huge profit margins and that they could cut rake by 70%+ and still be able to run like before. This is just so far from the truth however. Cutting rake means less advertising and I for one would definitely not want to go that route.

And also lol at all those saying games are unbeatable right now. Start to work more on your game guys or pls stop complaining about how tough it is. Poker used to be a goldmine, it no longer is and never will be again probably. The way it is now is likely close to a sustainable scenario, with only a certain % profiting at each level.
To have a site where close to 50% of total player pool could profit from poker is completely ridiculous fantasy-land thinking.
Remember that attracting depositing players requires advertising and advertising costs money, hence rake is needed for any site that wants game to actually run.

Like all of them.

Remember that guy who said he won $3000 but paid $5000 in rake doing it? Take away the rake and he's an 8k winner; you'd have to take >50% of his winnings to come out ahead. PLUS you're now getting no rake at all from all the losing and break even players.

bumhunter has spoken.

less rake = more action from regs, less bumhunting, still should be close to same amount of rake. But profits are spread between a bigger player pool.
go seat with 5 regs on the table and beat it for 10bb/100 then return to talk about working on your game.
more like to have a site where people are actually playing poker instead of a find-a-fish game.

The sites have way way more money than they need to run promos. Stars probably takes 1 billion $ from the poker economy/yr. So don't tell me that if they lowered the rake they wouldn't have enough for promos lol.

Stars is a business and a business' goal is to maximise their profits, not make "enough" and give away the rest. Same for poker players: even though many make money, they still want to make more and pay less. The only reason sites would lower their rake is if they think they could make more money by bringing in more action or preventing players from moving to other sites. It's a free market so you are always free to move on to another site or play less to pressure Stars into lowering rake. Asking for less rake so you can keep more money for yourself won't convince them.

The old FTP was run differently and look what happened...

yes,you doing good,keep do that

I think that FTP's business model was a good one, great software, great rakeback, good rewards, lots of red pros etc... The reasons they failed had nothing to do with rb/rewards.