Recreational Players Don’t and Shouldn’t Really Care About the Rake

Steve Ruddock : March 31st, 2016


I’ve had many interactions with casual poker players over the past 20 years. And whether it’s playing in card-rooms, in bars, or in home games, in all of the conversations I’ve had with these types of players, the rake is essentially a non-factor. It’s simply not on their radar. Rake caps, rake percentages, drop on the flop, none of this is something the vast majority of recreational poker players ever considers.

The reason for this ignorance should be obvious, the rake has a very limited effect on people who play relatively infrequently and for small stakes. On the other hand, the rake is an extremely important factor of the game for professional players.

It’s the difference between someone who wires $1,000 through Western Union once a year, so the $60 surcharge is meh, and a person who wires $1,000 every couple weeks who can’t complain enough about how much money they’re losing each year – about $1,500.

It works the same for poker players; the more you play the more you pay, as is the case with the following tales of Player A and Player B:

Player A is a decent poker player. She knows a good deal of strategy but is just barely beating the $25 NLHE games. Because of the rake changes and the cuts to VIP rewards she’s gone from being a slight winner to a slight loser, and her $1,000 bankroll will be slowly eroded (with a couple of upticks mixed in) over the coming months as she now has a slightly negative expectation in these games. It will take three months and 10,000 hands, but Player A will go broke.

Player B is a brand new player who deposited $1,000 and knows very little about poker. He plans on playing $100 and $200 NLHE, and because of his skill deficit he will lose at a rate of 5BB/100. Player B winds up going broke before playing his 300th hand.

Even though they both will lose the same amount of money, Player A, whose a near break-even player, will lose most of her money to the rake, and will do so in a very slow manner – in reality, she will likely contribute over $1,000 in rake before she goes busto. On the other hand, Player B’s $1,000 will likely be completely gone before he’s paid even $100 in rake.

Basically, Player A loses because of the rake, and Player B loses because of the other players.

But what about unbeatable games?

Andrew Brokos brought up rake hikes that make certain games unbeatable in a Twitter discussion, citing a specific tournament that looks to have an impossible to beat fee, and wondering how this is beneficial to anyone.

Brokos is correct, in the long-run, nobody will win playing this game. But, the trouble with that thinking is most recreational players don’t play for the long run, and even fewer will ever come close to reaching it.

For the most part, recreational players are victims, or beneficiaries as the case may be, of variance

Here’s an over the top example of this.

Suppose 100 recreational players enter a $2 tournament where $1 goes to the prize-pool and $1 to the rakeĀ  – the very definition of an unbeatable tournament. The tournament pays 10 places (1st = $30, 2nd = $20, 3rd and 4th = $10, and 5th-10th place = $5), so 10 players are going to win. The tournament is only unbeatable if they continue to play it, and it’s not out of the question that some player will play this tournament 10 times, cash in four or five tournaments, and take their $100 and move up in stakes.

That is the path of most recreational players. For recreational players it’s less about finding a beatable game to grind and more about upward mobility. For a negative expectation recreational player (whether they realize they’re -EV or not) winning in poker is a lot like winning on a slot machine – you hope to get a little lucky and cashout before the game can win its money back.

Just because a game is unbeatable in the long-run doesn’t mean no one will win.

To hammer this point home, I’ve played about 10 sessions of the very negative EV table game Three Card Poker over the years, and I’m a lifetime winner thanks to my first two sessions where I was the beneficiary of variance. I think I’ve had one winning session since (and it was a small win), so if I continue to play this game on the regular I likely won’t be a lifetime winner.

Time well spent is worth more than time

There is another stream of thought that extending the lifespan of a recreational player will make them happier. After all, who wouldn’t want to play 20 games of poker instead of 15? So, the argument is that the best way to extend their lifespan is by charging less rake; which makes sense.

But charging less rake causes other problems, namely it makes games beatable, and beatable games attract good players, assuming they feel the win rate is worth their while. As I explained earlier, recreational players aren’t losing because of the rake, they’re losing because other, better skilled players are beating them.

As crazy as this sounds, making a game beatable makes it less friendly for a recreational player. Since recreational players aren’t playing for the long run, they have a better chance for upward mobility in a high-rake/high-variance game, essentially, any game with very few good and or tight players.

You can find more on this concept here.

Final thoughts

This isn’t a call for online poker sites to make all games unbeatable, far from it.

This is an explanation why an extremely low rake in rec-heavy games doesn’t help these players or extend their lifespan. What it would do (in all but the lowest stakes where win rates would be extremely low regardless of rake) is attract more sharks who will chew up and spit out these players much faster than any unbeatable rake can.

Basically, if you want to argue against rake increases, pointing to its impact on recreational players, or the profitability of micro stakes games is a poor argument.

In an ideal world every game would be beatable by skilled players and recreational players would have fun losing; unfortunately, we don’t live in an ideal poker world.

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