Why there will never be a rake war (longwinded)

[lefty rosen]

There is also implicit collusion between the sites. Ie Pacific copying every party bonehead/greedy increase and Pokerroom just thinking all of the players are drunk retards that want to play any two........

[Sniper]

There already is a rake war going on!!!...right under our noses, but as you correctly point out, most players are oblivious to it!

The war is for knowledgable & high volume players... with the incentives being refunds of their rake via rakeback, bonus, vip/point programs, and other incentives.

Party and Ultimate's recent actions only highlight some of the recent skirmishes in this War!

Neteller, has proudly proclaimed that this war is of great benefit to them, as players are shifting more $$$ around from site to site chasing these opportunities, which substantially increases Neteller's revenue stream.

A recent Citigroup Global Markets analyst report asks this question... "How bad is it if you run out of Plankton?... To continue the fishy metaphor — it is bad news if you are a whale and you run out of plankton. The bear case on PartyGaming is that the business model is based on very active successful players feeding off what we have termed Plankton and that the supply of Plankton is limited. The risk under this scenario is that the poker industry runs out of people who to try poker, lose a little, get bored and stop. Similarly the players we have termed ‘Fish’ may have an interest in playing for only a limited time. PartyGaming has an additional problem in that there are many aggressive competitors for the supply of such players and that it is a challenge to maintain market share."

The war is on... the poker room winners will be those who have reduced the true net effect of rake to the knowledgable high volume players (those players that will still be around when the plankton run dry).

[UATrewqaz]

I agree there will never be a rake war for reason #1 alone, most idiots don't know the huge impact of the rake on their chances.

An extra .25 a pot? Who cares, etc. When it in reality results in thousands more dollars a day coming off the tables.

There WOULD be a rake war if mos tonline player became aware of it, but then online poker wouldn't be worth playing, too many knowledgable players.

Like that tard that just busted my AKs with his 47o, calling down his pair of 4's the whole way and spiking a 7 on the river, god bless him.

But i do forsee a site where a low rake becomes their "thing" just like Full Tilt has all the pros, Poker Stars is the "tournament" place, etc.

There will be site X and their big thing will be "ULTRA LOW RAKE!"

Long story short, I disagree. The rake is high enough and if it goes any higher it will break thousands of winning players today. Sooner or later the poker room greed will put themselves out of business, end of story.

Winning players are making 1-2BB/100 hands, that really isn't much unless your doing this at 10/20 and higher.

[Uglyowl]

There becomes a point though where higher rake will bankrupt the consumer too quickly and won't be fun for them.

If they can get say $100 and play 10 hours at $2/$4 that may be $10/hour for entertainment.

Ever rake increase makes the money dwindle quicker, they may not know why, but they will notice.

[Greg J]

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There becomes a point though where higher rake will bankrupt the consumer too quickly and won't be fun for them.

If they can get say $100 and play 10 hours at $2/$4 that may be $10/hour for entertainment.

Ever rake increase makes the money dwindle quicker, they may not know why, but they will notice.

[/ QUOTE ]
Excellent point. I don't think the rake can increase indefinately. I think my original post might have implied that, but that was not my intention. There is certainly an optimal point. I'm not sure what that point is, but I bet there are many people working for poker sites doing some research on that subject right now.

[Exsubmariner]

I honestly don't get your reasoning here, sniper.

What Potty and UB did recently was NOT good for volume players. I got bit by both. What the hell are you going to do? Go pay rake at Poker Stars because they are so aloof that they have never involved themselves with networks or affiliates and therefore smell like roses?

Come on. It's obviously in the interests of sites to take as much from volume players as they possibly can. That's why they keep trying.

I think Greg is right. The long dreampt of rake war will never come. If anything it will get worse before it gets better and the only way it gets better is if (and its a big IF) online poker has another boom.

The only thing I see happening is there are fewer and fewer sites around squeezing as hard as they can. Please tell me more about your thinking.

X

[Sniper]

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What Potty and UB did recently was NOT good for volume players. I got bit by both.

[/ QUOTE ]

That is exactly my point.... Party and UB were getting destroyed by Empire and Pokershare, so Party and UB nuked them into oblivion.

Empire and Pokershare were rewarding knowledgable high volume players with better rewards (ie lower net rake), the larger rooms threatened by this had to act, and acted swiftly and decisively!

Unfortunately for Party (the market leader with 50% share), they can't use the same tactics against Absolute, Prima and Crypto. [This is good for the players]

Should Party buyout Empire AND replace their own marketing dept with Empire's, watch out as they will then have the knowledge to really damage the other rooms, and shorten the war (short term good for players, long term probably not).

[Exsubmariner]

I doubt Potty is smart enough to fire their marketing dept and replace it with Empires. The only reason Potty would buy Empire would be to suck up their player base and keep the profits. They would prolly fire everybody from the company they didn't think they needed. I imagine this would include the marketing group. After all, wasn't their marketing team the one that came up with the cruise?

I see Pokershare or something like it re-emerging with it's own platform. Now, if they hired Empire's marketing team........

Your argument is way too simple. You have failed to factor in the many middlin' players who are just barely beating the rake. I would imagine that these players comprise a significant portion of the so-called "sharks." If the rake goes up just a little bit, these players will no longer be able to win and will eventually stop playing.

If you were to plot a chart of winning players, with the win-rate on the y-axis and the percentage of players on the x-axis, it would be parabolic. There would be a few players that are beating the rake significantly and a bunch of players that are just barely beating the rake. If the rake goes up, these guys who are just barely getting by will probably quit.

Recreational players don't play a lot. Party needs the winning players for their volume. If the rake goes up even 5% from what it is now, a lot of the grinders will have to find some other way to make money. They will decrease their playing frequency and Party will lose money overall.

However, the big money for Party in the future will likely come from Blackjack, Sidebets, and other goofy games where all the edge in the game benefits Party. So, maybe they don't care if they scare away all the sharks by raising rake because they would rather have people play blackjack and roulette.