Rake is ridiculous, time to change the rake system?

I know that saying this won't work as online poker sites are business and the business main goal is to profit the maximum. Therefore as long as there is demand there will be supply even if the deal is unacceptable.

Of course people being people we will still go to poker sites and play even if they charge 5% or even if they decided to charge 10% some will still play as there is so many poker sites only (with real traffic). Hell, even casinos have tons of people going even though clearly you are losing a % of your bet every time to house edge.

To give you an idea how ridiculous rake is, let me tell you from simple observation from a raked $ 1/2 home game their rake averaged about $150 an hour. The rake is 5%.

We take an example that the game is 10 handed, there are 2 fishes (which is great already considering how NLHE has evolved, era of tables more then half fishes gone) 4 are break even players and 4 are winning players. Each of them brought $400 for simplicity sake.

Lets say the game runs for 8 hours before breaking. $150*8= $1200.
So who's the big winner? The house of course! Its ridiculous even the MOST SKILLED player won't make more or even close to what the house makes!

$1200 = 3 buyins, which means 2 of the fishes buyins go to rake (the money might have spread around the table but ultimately it goes to rake as the fishes will bust), so we left $400 rake spread amongst 8 people, so everyone would have left about $350, but 4 of them are winning players so lets say then each win $150 from the breakeven (slight losers) players...

Final score

pro 1 $500 (+$150)
pro 2 $500
pro 3 $500
pro 4 $500
normal 1 $200 (-$200)
normal 2 $200
normal 3 $200
normal 4 $200
fish 1 bust (-$400)
fish 2 bust
House $1200 (+$1200)

It must be clear from this diagram that even Phil Ivey with all the skill in the world playing such stakes (Obviously he play much higher stakes so rake is negligible) would NEVER even come close to what the house makes.

If there is no rake the fishes money would be spread around each of the 8 players and let say the pros make $150 from the average players (Reasonable assumption)

Final Score (NO RAKE)

pros $650 (+$250)
normal guy $350 (-$50)

You can see that the people with skill makes almost double what they earn daily. $100 difference in a day, $3k in a month! $36k a year to rake!

My take, charge 2% rake for online sites without rakeback b******t (I know its a business so no rake wont work but 2% is already great considering how much casino games make with just 1-2% edge) Also, online sites do not have much maintenance costs to get them running so they earn tons...Also why not just charge 2% rake without cap so that the ultra-high stakes player pay accordingly too instead of $50 rake in a 20k pot. And other players wont have to pay the same $50 for the $1k pot. This would offset the micro players paying a lower rake.

Its a reasonable system and give micro players with decent skill a chance to move up

And for home games its ridiculous to charge so much just for dealing games in your home. I would say each pay $10 for the dealer for dealing (And occasional tips) and that's all.

Of course all these falls on deaf ears...

My take, run the home game.

i dont agree. they need to have rake. 2% is enough for a lot of sites to make a profit. they have things to pay for....comparing it to a casino isnt accurate. having rakeback is nice

wont ever happen lol

I like what your saying here, but like you have already stated, there is a better chance of pigs flying.:willy: :willy: :willy:

I think it's too high.
I think if a site were to come along & charge lower tourney fees (right across the board with all buyin levels, especially micro/low) I think they could do well.
ie. charging 5-6% on Sit'nGoes right down to the $2 buyin level (10% for $1 & under). No doubt that they'd get far more than double the volume of play while charging half the going rate.
Anyone want to help me start up a site? (I have ideas.... just no capital)

pokerprince89 said:

Also, online sites do not have much maintenance costs to get them running so they earn tons...

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I would think advertising alone would cost HUGE dollars.

Micro and small stakes games have always been a rake trap. Probably will be until the end of time. It actually isn't cheap to move money onto and off of sites. Especially small amounts of money.

That said, the system is basically set up in such a way that players learn sub-optimal tight poker to beat the smaller stakes games. As they move up, they slowly open up their game with each new higher stake (or at least should) as the rake blunts less an less of the edge.

Ultimately, at the higher stakes games. Rake becomes insignificant. It's fun at the top. I wish you all the best of luck sticking it out. Speaking from experience, it can be done

--
Kahn

Poker Orifice said:

I would think advertising alone would cost HUGE dollars.

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I've read an article which estimates pokerstars gross revenue is 1.5 billion per year. Surely advertising doesn't cost that much?

Kahntrutahn said:

Micro and small stakes games have always been a rake trap. Probably will be until the end of time. It actually isn't cheap to move money onto and off of sites. Especially small amounts of money.

That said, the system is basically set up in such a way that players learn sub-optimal tight poker to beat the smaller stakes games. As they move up, they slowly open up their game with each new higher stake (or at least should) as the rake blunts less an less of the edge.

Ultimately, at the higher stakes games. Rake becomes insignificant. It's fun at the top. I wish you all the best of luck sticking it out. Speaking from experience, it can be done

--
Kahn

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I'm committed to the game, i'm seeing improvements in my game now and i'm fully confident I can beat the micro/small stakes. See you at the top!

pokerprince89 said:

I've read an article which estimates Pokerstars gross revenue is 1.5 billion per year. Surely advertising doesn't cost that much?

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Pokerstars doesn't utilize affiliates as much as other sites. They also have tons of site pros. Advertising isn't cheap for them by any means. If you are insinuating it's 1.5billion worth of advertising, obv that's not correct and they do show a healthy profit

pokerprince89 said:

I'm committed to the game, i'm seeing improvements in my game now and i'm fully confident I can beat the micro/small stakes. See you at the top!

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No doubt, I hope so too.

Marginal said:

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Best.

And as already stated, it doesn't really matter what one or ten or a thousand players think. Rake is the lowest it will get because competition does exist. To start up a site costs a lot of money too, not to mention player base would suck for a very long time.