An Analysis of Different Poker Rake Distribution Systems by Jonas Odman

An Analysis of Different Poker Rake Distribution Systems by Jonas Odman

Press Release
Source: BodogNetwork.com
September 13, 2010

LONDON, September 13, 2010 /PRNewswire/ -- When Bodog Network presented the concept of a new rake distribution system last year there was enormous debate and, inevitably, flattering imitation. But as they say 'the proof is in the pudding' and we can now assert that we are delivering on our promises to players, affiliates and, next year, to other operators.

As we hoped affiliates with a high proportion of net depositing players now earn more money from their revenue share deals than before and the all-important 'leisure' player is also much better supported.

Ongame Network, iPoker Network, and Microgaming Network have systems designed to achieve the same thing but in different ways, and in this article I will give my view on the strengths and weaknesses of the different systems.

Most agree that the old way of splitting the revenue between operators was skewed, and operators/affiliates bringing in net depositing players were not rewarded enough. The root of the problem was the way rake was assigned to players in the back-end, and that is where Bodog Network has addressed the problem. Bodog Network is the only poker network which has stopped splitting the revenue per hand. Instead, at the end of each business day, Bodog Network uses a proprietary algorithm to split the revenue which rewards net depositing players. And unlike all competitors' models, the Bodog Network model works for all players from day one.

Ongame Network call their system Essence. Based on the players' results and playing style during the last 90 days, players are assigned a coefficient. The rake is split per hand, just like the old system, but the coefficient is used to correct the flaws of the old system. A player's share of the rake will depend on both his coefficient and his opponents' coefficient in that hand. This is the second best rake distribution system in the industry but there are some obvious problems with it. Firstly, it takes 90 days before the system starts working, so new winning players will be assigned much more revenue than old winning players. Secondly, we know that 50 % of the players never make a second deposit-these players will not stay long enough for their operators to be fully rewarded for bringing them in. Thirdly, the system can and will be abused-by creating a new account on the network every 90 days, winning players with under the table rakeback deals can sustain too big a value for their operators/affiliates.

Microgaming Network and iPoker Network have a blunt system where operators with too many winning players are fined each month. The networks are basically keeping a rake distribution formula they know is wrong and then punish operators who benefit too much from it. This creates big problems for operators who get fined, because it is impossible for them to then split that cost between the operator's affiliates with revenue share deals. Some operators have reacted by blocking winning players which is a natural and understandable reaction but at the same time bad for the networks' reputation. Why would anyone want to play on a poker site or network where winners get blocked?

All systems, including Bodog Network's, have in common that they lack transparency. However, from an affiliate's or an operator's perspective, the old systems were not that transparent either. Yes, players with 1) hand trackers and 2) knowledge of how the network split the rake between operators could calculate their share of the rake (and hence their rakeback), and now all networks are removing that transparency. Here it is important to remember that the rake distribution models were only meant to regulate the business relationship between a poker network and an operator, as well as an operator and an affiliate with revenue share deals. Rakeback deals were just an unwanted consequence which is now being dealt with.

Net depositing players are the bread and butter for a poker network, and it is a good thing for online poker that poker networks are starting to acknowledge that. This will lead to more healthy poker ecosystems and in the long run all players will benefit from this.

Jonas is the Vice President of Bodog Network

Unabomber wins first bracelet at WSOP Europe

Unabomber wins first bracelet at WSOP Europe

16 Sep 2010

Phil Laak has done just about everything in poker.

He's won major tournaments. He cashed numerous times. He played in high-stakes games on television. He's traveled around the world playing. He become famous. He dates a movie star. He's even set a world record for the most consecutive hours spent playing poker (115). The one thing Phil Laak had not done, was to win a WSOP gold bracelet.

Until now.

Everest Poker

Laak, a.k.a. the "Unabomber" achieved a breakthrough victory in the £2,500 buy-in Six-Handed No-Limit Hold'em championship (Event #1), which is the first of five events scheduled at this year's tournament series played at London's Casino at the Empire. The Las Vegas resident and poker pro collected £170,802 for first place, which is the equivalent of about $270,000 (USD).

Laak overcame a strong showing by Andrew Pantling, from Malta by way of Toronto, Canada. Pantling dominated play during most of the three-day tournament. He seized the chip lead late on Day One. He continued to hold the lead throughout Day Two and arrived at the final table way ahead in chips by nearly a 2 to 1 margin over his closest rival. Once the final table began, Pantling was never in serious danger of relinquishing his advantage until he became embattled in a heads-up duel with Laak. It was Laak who was the recipent of a fortuitous flurry of good fortune en route to a thrilling first-ever gold bracelet victory.

The win was particularly pleasing to Laak at this moment, given his history. Laak finished second five years ago in a heads-up match against Johnny Chan when he won his then-record tenth gold bracelet. He came to the final table with his right arm in a cast and sling, the result of a serious accident on an ATV last month. Laak, who was cheered on to victory by his biggest fan -- Hollywood actress and former gold bracelet winner Jennifer Tilly -- seemed far more serious than his usual unpredicatable persona. While he talked throughout the finale, wild antics that usually accompany a high-profile finale were missing.

The final table included two former WSOP gold bracelet winners – Chris Bjorin (London, UK) and Willie Tann (London, UK). Also present were Rouah Ilan (Strasburg, France), Andrew Pantling (Malta), and David Peters (Toledo, OH USA).

The tournament was a complete sell out, attracting a capacity crowd totaling 244 entries. The prize pool amounted to £610,000. The top 24 finishers collected prize money. Among those who cashed was John Tabatabai (Cardiff, UK), who was the runner up to Annette Obrestad when she won the inaugural WSOP Europe championship held in 2007.

With yet another impressive third-place finish, two-time former gold bracelet winner Chris Bjorin now has five WSOP Europe cashes and three final table appearances -- the most by any player. Since this was only the 12th gold bracelet presented in Europe, that means Bjorin has cashed in 42 percent of events and final tabled one quarter of all tournaments played in London.

Courtesy of Nolan Dalla, WSOP.com