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Rake pricing for a sustainable poker ecosystem Rake pricing for a sustainable poker ecosystem

01-28-2013 , 05:14 PM
Quote:
Originally Posted by POW
This link through pokerscout has the graph below showing peak-player numbers:

I think it's pretty well known fact though that there has been a decline in players over the past couple of years. But it's not as well known that volume has indeed been steadily increasing over the past year.

EDIT: Thanks for posting that graph though, interesting stuff.
Rake pricing for a sustainable poker ecosystem Quote
01-28-2013 , 05:15 PM
Quote:
Originally Posted by Bad Luck Brian
Poker scout shows a pretty solid upward trend over to past 6 months for all the major poker sites. To me, that doesn't say poker is dying.

Haven't people been saying the same thing since the birth of online poker? First it was 2006 with UIGEA, then 2008-2011 about people whining about games being too hard, then Black Friday (which was a legitimate concern), and recently the scaling back of RB and promos has lead to people spouting the same moronic doomsday prophecies. There are problems with online poker right now for sure, but they aren't nearly as dire as many people here make them out to be.
Traffic almost always spikes up during the northern hemisphere winter. You have to compare year vs year, not 6 month intervals. Also, many sites changed networks at various points. Year vs year numbers have decreased even with FT reopening AFAIK.
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01-28-2013 , 05:18 PM
Quote:
Originally Posted by JB262
The grim reality is that due to heavy regulation and a fractured market, PokerStars holds a virtual monopoly, and that's always going to cost more for the consumer.

Pretty sad that it costs about $14/hour per table to play online cash poker, which is about the same as it costs to play live poker. Surely the online sites could pass the savings of having a virtual room as opposed to a live room on to their customers.

That being said, as soon as online poker is legalized in the US and the regulations are aligned with other countries, PS will get some competition that will lower the rake.

Obviously the current situation is already killing the ecosystem.
Is the rake really 7BB/100 @ NL 100? Even if it is, players are getting a significant amount of that $14/hr back via promotions.
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01-28-2013 , 10:32 PM
Quote:
Originally Posted by LT22
Is the rake really 7BB/100 @ NL 100? Even if it is, players are getting a significant amount of that $14/hr back via promotions.
It's 7BB/100 at 1/2 HULHE. That's a game where there's almost no way a casual player gets supernova and where even a world class player will have difficulty sustaining a decent win rate. Beginners get slaughtered on short order and permanently leave the system. How can that be a good model?
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01-28-2013 , 11:41 PM
Quote:
Originally Posted by Bad Luck Brian
Poker scout shows a pretty solid upward trend over to past 6 months for all the major poker sites. To me, that doesn't say poker is dying.

Haven't people been saying the same thing since the birth of online poker? First it was 2006 with UIGEA, then 2008-2011 about people whining about games being too hard, then Black Friday (which was a legitimate concern), and recently the scaling back of RB and promos has lead to people spouting the same moronic doomsday prophecies. There are problems with online poker right now for sure, but they aren't nearly as dire as many people here make them out to be.
You need to look at year long graphs. 6-month graphs are irrelevant due to seasonal changes. We just entered what is supposed to be the highest point of the year for online poker. There is also the issue that the relaunch of FTP brought hundreds of thousands of players out of retirement and into the games. And lastly, even on year over year figures, there was a fairly large exodus from players at Stars once they swapped to weighted contributed which is just about 1 year today exactly. That should artificially inflate their year over year numbers as presumably some of the 'knee-jerk leavers' would return. They haven't. Stars has lost even more players since that. In spite of all that Stars is indeed still down about 5% year over year. Given the context of the loss that is rather disconcerting as it seems much more likely we can expect their losses to accelerate than slow.
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01-29-2013 , 04:45 AM
Quote:
Originally Posted by JB262
The grim reality is that due to heavy regulation and a fractured market, PokerStars holds a virtual monopoly, and that's always going to cost more for the consumer.

Pretty sad that it costs about $14/hour per table to play online cash poker, which is about the same as it costs to play live poker. Surely the online sites could pass the savings of having a virtual room as opposed to a live room on to their customers.

That being said, as soon as online poker is legalized in the US and the regulations are aligned with other countries, PS will get some competition that will lower the rake.

Obviously the current situation is already killing the ecosystem.
this post is disingenuous at best
Lets go with 14 dollars an hour online- which you're getting 100 hands an hour for that table and on top of that you get rakeback rewards etc
50-80 % is pretty easy to get

so 100 hands costs you 3-7 dollars

Live:
30-35 hands an hour
Depending on where you play probably anywhere from 10-15 dollars an hour in rake (if you play short handed in la or florida this can easily be 50+ dollars an hour) plus tips and bad beat jackpots
I estimate in AC i pay about 18-20 dollars an hour playing mostly 5/10nl, in vegas probbaly somewhere around 15-16 (no bbj) LA easily 25

Lets just take the lowest one Vegas and call it 15 dollars an hour

For 100 hands Ill pay about 45 dollars
For 100 hands online with mediocre rakeback I would pay 7 dollars an hour

Cmon- taking the cheapest live option and comparing it to playing online with nothing special rakeback it still cost 7 times more money per hand to play live than it does online

This doesnt even factor in how much Ive spent on flight, hotels, etc not to mention the time of getting to these places and waiting on wait lists

Sure it costs a lot less to operate an online card room
And because it does you pay at least 7 times less per hand, can play from home, dont waste time traveling or being on wait lists, dont waste money on hotels flights gas etc so don't act like you arent benefiting drastically.

The entire point you just made is a complete lie.
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01-29-2013 , 04:50 AM
Quote:
Originally Posted by JudgeHoldem1848
It's 7BB/100 at 1/2 HULHE. That's a game where there's almost no way a casual player gets supernova and where even a world class player will have difficulty sustaining a decent win rate. Beginners get slaughtered on short order and permanently leave the system. How can that be a good model?
its not and the fact these sites offer heads up tables still amazes me
it is terrible for the site and terrible for the casual players
rake at hu tables should be high- while there is no intelligent reason for sites to even have hu tables having them, raking them for low amounts makes absolutely no sense. These tables are just a way for good players to bum hunt and quickly fleece bad players. The players winning on these tables are a complete detriment to the sites.

Too many people on this site refuse to look at things from any perspective but their own.
I mean it cant be all the things 2p2ers asked for an/or support like mass multitabling,hu tables, training videos, deal method of rb,tracking software,table ninja etc that kill them games, it just has to be the greedy sites and their rake (even though rake is a lot lower than it was a few years ago)
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01-29-2013 , 04:54 AM
If you can get greedy Stars to reduce rake then my hats off to you.

100bb/100 rake at small stakes PLO @ Stars. Think about it.
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01-29-2013 , 04:57 AM
Quote:
Originally Posted by JB262
Also, I think charging a fixed rate per time, say $7-$8 per hour at $100nl would be good but either way I'm sure that the sites could charge about half the rake they charge right now and still make a tidy profit. Although the Eric Lindgrens of the world won't get their 5fig monthly paychecks and 7fig credit lines, they'd at least have a shot to make a living at the tables.
this is by far the fairest way to do it
the current system of tight players paying a lot less than loose players in rake makes no sense
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01-29-2013 , 06:07 AM
Quote:
Originally Posted by borg23
its not and the fact these sites offer heads up tables still amazes me
it is terrible for the site and terrible for the casual players
rake at hu tables should be high- while there is no intelligent reason for sites to even have hu tables having them, raking them for low amounts makes absolutely no sense. These tables are just a way for good players to bum hunt and quickly fleece bad players. The players winning on these tables are a complete detriment to the sites.

Too many people on this site refuse to look at things from any perspective but their own.
I mean it cant be all the things 2p2ers asked for an/or support like mass multitabling,hu tables, training videos, deal method of rb,tracking software,table ninja etc that kill them games, it just has to be the greedy sites and their rake (even though rake is a lot lower than it was a few years ago)
I've read plenty of anti-HUHU arguments before and tbh haven't given them a lot of thought, but you're right, I only look at things from my own vested perspective as does anyone else. I started playing HUHU because it was there to play and as I recall, ironically, because it earned sign up bonuses much faster.

But as long as it's offered the rake should NOT be 7BB/100 in a game where the greatest players ever, Bryce Paradise comes to mind, were probably only causing losses to their opponent of around that figure or less.

The problem with obscene rake once you commit to offering those games is that it wipes out fish at warp speed. If there were no rake at 1/2 HULHE, given the suckout prone, small-edge nature of the game, fish would go on heaters that would last months, possibly years. Instead they get their whole bankroll creamed before they get to 2k hands. Again, if you've decided to offer those games which is the status quo like it or not, I ask - how can that be a good model?

I guess ultimately you have to define what the purpose is of the whole enterprise. But rake which is exorbitant to the point of being insurmountable serves the interests of neither pro fish nor room.

Last edited by JudgeHoldem1848; 01-29-2013 at 06:13 AM.
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01-29-2013 , 06:48 AM
Couldn't we sell a for the players, by the players ... incorporation. Sell shares. Dev a whole new site, based on your rake structure idea?

Any econ majors here? I mean ... build it ... and they will come. It all comes down to being in the right place at the right time and the cost of startup, but count me in if you decide to go that route. Simple, no HUDs ... level playing field ... I'm in.

I'm all in. I will help you brand and dev that.
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01-29-2013 , 08:01 AM
Please don't think I am spamming a thread here.

I am developing a new poker site and looking to test over the coming weeks.

The sole purpose was to make a site that is better for the games and the poker economy. I have taken on a lot of considerations and feature requests from other forum posts and the next biggest thing is to design a rake/rakeback/vip program that is fair.

So I'm going to be reading through all this thread for ideas.

If anyone has a quick summary of what people have suggested, pros, cons etc that would be nice. If not I'll just do the work

You can find out more about the site and development here http://forumserver.twoplustwo.com/45...e-see-1280010/

Also if there's anything you would like to see in a poker site that is not specific to rake please post in that thread and I will try and get it in if reasonable.

Thanks

Dean
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01-29-2013 , 08:09 AM
My idea is what I just said. By the players for the players. For real this time.

10,000 minds are greater than 9999.

Make it a US corporation .... poised to be the first, real, low rake ... no HUDs ... no bum hunting ... PPA approved, tax friendly system. Obviously some people would bring more to the table, but ... we'd be open to all ideas.

Last edited by afwoods; 01-29-2013 at 08:15 AM.
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01-29-2013 , 08:18 AM
Make a private offering to raise funds right here on 2p2. Everyone can get some of it.
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01-29-2013 , 08:30 AM
PM me if you are serious about this. I will work for equity.
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01-29-2013 , 11:39 AM
@afwoods the problem is that dean_nolan_1 is designing a web based site, working with bitcoins. I just don't think it's a good idea, I don't see it taking off.

I am all for the idea of crowd funding our own website though. MermaidPoker (part of the Boss network) is, AFAIK, owned by 262 danish players. So its definitely doable.

I think creating our own room and joining one of the following networks:

- Microgaming
- Ongame
- Pacific
- iPoker
- Revolution
- Boss

And consequently removing the flaws of this networks (improving the software by removing any of the dozens of easily fixable flaws, giving more money towards rakeback and promotions, removing any bots, better support, reducing the affiliate cut and gearing towards more "casual affiliates"...) we can absolutely dominate the market.

BTW a few posts above I talked about the current legislation situation in Bulgaria. Basically whoever gets a lisence first will have a legal monopoly until any other rooms also get a lisence.

Assuming 95% of the bulgarian players will move to play in the new room, and 60% of those will stay for at least 3 months (we will be offering 45-55% rakeback, so even that is pessimistic), averaging a rake of 25€ per player, and we only get to keep 10% of the profits, putting the rest back towards taxes, salaries, software improvement, affiliates, rakeback, promotions, merchandise, we will have payed back our initial investment of 1,060,000 BGN within the first three months and have a profit of ~162k BGN (83k EUR) and an operating room with half the bulgarian market.

I'm not making this numbers on the go, I've calculated them down to the daily coffee the sysadmin is going to have, the exact t-shirts we are going to give out, the VIP system numbers and so on and so on. Obviously I have no way of knowing the exact demographics, and exactly how much is everyone going to rake, and exactly how much the poker room will be paying towards banking fees etc., but I'm 100% confident that this is an awesome business opportunity.

So basically if anyone can make this happen, I'll contribute 5k EUR of my own money, assuming the business plan is sound.
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01-29-2013 , 11:47 AM
You want to create your own awesome site with different promotions/software/etc, but yet you want to join a network? Those are the exact opposite of each other.
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01-29-2013 , 12:09 PM
Why? Different rooms from the same network share only the player pool and offered games in most cases, as well as the biggest promotions in some cases, and can offer completely different rakeback, software and promotions. Obviously there are some network guidelines that have to be observed, but those vary from network to network and don't really disprove my point.

Edit: also, joining a network is not by all means required, I just think its more than OK, since it offers an already developed player base and some software to build on. I don't want the new players to register, see 2 tables running, and promptly leave.

Anyway my point was that I'm all for the idea and think its super good investment, I just disagree with the "browser based, bitcoin currency only" part.
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01-29-2013 , 12:42 PM
Quote:
Originally Posted by JudgeHoldem1848
I've read plenty of anti-HUHU arguments before and tbh haven't given them a lot of thought, but you're right, I only look at things from my own vested perspective as does anyone else. I started playing HUHU because it was there to play and as I recall, ironically, because it earned sign up bonuses much faster.

But as long as it's offered the rake should NOT be 7BB/100 in a game where the greatest players ever, Bryce Paradise comes to mind, were probably only causing losses to their opponent of around that figure or less.

The problem with obscene rake once you commit to offering those games is that it wipes out fish at warp speed. If there were no rake at 1/2 HULHE, given the suckout prone, small-edge nature of the game, fish would go on heaters that would last months, possibly years. Instead they get their whole bankroll creamed before they get to 2k hands. Again, if you've decided to offer those games which is the status quo like it or not, I ask - how can that be a good model?

I guess ultimately you have to define what the purpose is of the whole enterprise. But rake which is exorbitant to the point of being insurmountable serves the interests of neither pro fish nor room.
I'm not the first to suggest this, but imo the solution simply has to be some kind of fusion between the cash format and the husng format. As always, the challenge is to convince the sites that they'll make up for lower rake through increased volume and game sustainability.
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01-29-2013 , 01:14 PM
Quote:
Originally Posted by meepwn
@afwoods the problem is that dean_nolan_1 is designing a web based site, working with bitcoins. I just don't think it's a good idea, I don't see it taking off.
Valid concerns. I am launching with Bitcoin only at first but the plan will be to open to other currencies and markets. I have a potential business partner that we are doing a lot of research and preparation for this.

First for me though is to focus on getting the software right. I have made good progress with this and would not really be looking to partner with other developers at this stage.

As for Bitcoins not taking off you might be surprised, check this article for instance http://www.forbes.com/sites/jonmaton...2012-earnings/
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01-29-2013 , 03:26 PM
Quote:
Originally Posted by borg23
this post is disingenuous at best
Lets go with 14 dollars an hour online- which you're getting 100 hands an hour for that table and on top of that you get rakeback rewards etc
50-80 % is pretty easy to get

so 100 hands costs you 3-7 dollars

Live:
30-35 hands an hour
Depending on where you play probably anywhere from 10-15 dollars an hour in rake (if you play short handed in la or florida this can easily be 50+ dollars an hour) plus tips and bad beat jackpots
Most people in the thread who disagree are winning players who aren't seeing this from the point of view of the losing player, which comprise the majority of all poker players. A winning player will measure his value in terms of $/hour, whereas a losing player will measure it in terms of how long they get to play before they have to reload. The effect of having 3-4 times as many hands online as live only serves to alienate the fish faster.

I see three things drastically wrong with the rake system

1) It's way too high
2) It's not scalable. There is no earthly reason that the LHE game should be raked as high as the NLHE game. This is a game that has a lot of growth potential but it's currently unbeatable at low levels due to the rake. Since you deal many more hands per hour as in NL, there should be a corresponding drop in the rake cost. Also PLO8 has the potential to explode in popularity, but with the amount of split pots the current rake makes it unplayable. Also, there is a wide separation in the percentage of money being raked compared to the pot sizes. Players at nosebleed are paying a tiny % of winnings to the rake, but the players at micro are seeing as much as 3 quarters of their winnings gone to the rake.
3) The current rakeback/bonus systems being employed are tailored for the skilled player, meaning the fish are getting no incentives to play.
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01-29-2013 , 03:53 PM
By the way, if poker sites were to extract exactly the same amount of money for the rake as they do now, but charge an hourly rate rather than an amount per hand, this would immediately benefit poker because it's inherently scalable.

Consider that as it stands now, you pay less in rake overall when you play 9max as opposed to 6max, simply by being able to profitably play less hands. If the sites charged hourly to play, the $/hand for 6max would automatically be lower than 9max.
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01-29-2013 , 06:09 PM
Quote:
Originally Posted by JB262
By the way, if poker sites were to extract exactly the same amount of money for the rake as they do now, but charge an hourly rate rather than an amount per hand, this would immediately benefit poker because it's inherently scalable.

Consider that as it stands now, you pay less in rake overall when you play 9max as opposed to 6max, simply by being able to profitably play less hands. If the sites charged hourly to play, the $/hand for 6max would automatically be lower than 9max.
So yes that might be true.

However it does not matter if the money taken via time or rake. The problem is the amount that is taken out per game the difference in effective rake and how the rake makes the games unbeatable over all.

In the end the problem is that money won vs money raked is bad. If you replace rake with time your not fixing the problem overall. Maybe re-shifting though and some games might benefit, but as a whole it wont solve anything.
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01-29-2013 , 07:19 PM
Quote:
Originally Posted by knircky
So yes that might be true.

However it does not matter if the money taken via time or rake. The problem is the amount that is taken out per game the difference in effective rake and how the rake makes the games unbeatable over all.

In the end the problem is that money won vs money raked is bad. If you replace rake with time your not fixing the problem overall. Maybe re-shifting though and some games might benefit, but as a whole it wont solve anything.
Also as the current rake system is the most hidden way of charging players, any attempt to replace it with $/hr or withdrawal fees could result in losing customers to other sites that hide their fees better.

e.g. a system charging a 25% withdrawal fees on player profits would be taking far less rake but would seem like a total rip of to most recreational players.
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01-29-2013 , 08:21 PM
Quote:
Originally Posted by POW

e.g. a system charging a 25% withdrawal fees on player profits would be taking far less rake but would seem like a total rip of to most recreational players.
Unfortunately :-) Even 10% will seem that way :-)
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