Online poker networks such as GGPoker and iPoker use specific models like PVI and SBR to calculate rake for skins, affiliates and players
Anyone with any kind of experience of poker – particularly online – is aware of ‘rake’ (typically the nominal cut taken from a pot by the poker room) and its significance. Different providers have different approaches, and in this article we will discuss two quite different models for calculating the rake at the iPoker and GGNetwork respectively. Rake affects all poker fans, from hardened grinders to recreational players looking to get the most value for their money, so it’s useful to know the mechanics of the subject.
Both models have different names, but are essentially based on the same principle. For those of you who are not sufficiently acquainted with the concept, let’s first explain what PVI and SBR are all about, taking partypoker and Bwin as an example. As some of you will be aware, both poker rooms form a network despite being two different sites. Every poker room is financed by the rake (and fees) which a player pays at the tables as a kind of service fee. If a player generates $10 in rake, this amount forms the basis upon which calculations are made to determine what the poker room and, in turn, the affiliate receive. So far, so good…
If everyone were to do this in the same way as PartyPoker/Bwin it would be great, but this isn’t exactly the case at GGPoker and, also, at iPoker. Over the years it has become common practice that skins and affiliates receive less commission for a strong player. This means that a player might generate $10 in rake but ultimately only $5 goes to the skin and us as an affiliate. At iPoker the player is not impacted much, while it is quite extreme at GGPoker, where a good player is equally disadvantaged together with the affiliate.
As if that wasn’t annoying enough, there isn’t even a clear statement about the criteria for calculations, rather there is only basic information, which is not very helpful:
- Deposit and withdrawal behaviour
- Gaming behaviour
- Which players are losing or winning money
This information does not offer anything useful to the affiliate, the poker room or the player. The only fact is that networks like iPoker and GG (and, in the past, MicroGaming) withhold part of the rake. The point is that poor players who bring money into the system will be rewarded, and good players who take money out of the system will be punished.
We can try to explain this with the following example: One of our players has been down almost $15,000 since starting at the GG network and has not yet made a cashout. Logic suggests that this player should be counted as a fish, and that one should actually count 100% of the real rake, or even more. Unfortunately, this works only for a very short time and then it usually goes down relatively quickly, so that in the end only 40%-65% of the rake actually generated may be counted. Why this happens, nobody really knows…
At GG it is the case that a good winning player has an average PVI of 0.4-0.6 depending on the type of game they favour, which means that only 40%-60% of the rake actually generated is counted. At iPoker it is similar and here it has thus far been that, with a winning player, 50%-55% of the real rake was always counted. This has recently been increased slightly, so that a minimum of 60%-65% is counted. Not perfect, but a step in the right direction.
In the meantime, the affiliate no longer knows how much rake (real rake) a player generates. The data that we receive as an affiliate is not helpful, and we don’t know much more than the player.
What happens to all the rake that is withheld from SBR and PVI?
This is the key question! The official info is that it is kept for network promotions, marketing and to improve software. That all sounds good, but we shouldn’t forget that the network anyway receives a certain percentage of the rake generated from each player. Every provider of a network has to pay a network fee, which is usually around 10% of the gross rake. It seems that this is not enough. Especially in the case of GGPoker as network owner, it should be easy to find a better solution rather than deducting so much for the PVI.
It has to be said that the set-up at GG is, to a point, understandable, at least over the last few months. A lot was withheld from PVI, but a lot was also spent through network promotions, the marketing drum was stirred vigorously and the tables are always full. However, development is going in the wrong direction because too much is still being withheld through PVI, promotions are now falling month after month and yet the action is increasing. While there were recently daily rake races of $50,000 for Texas Hold’em, Pot Limit Omaha and Spin & Gold, it is now only $25,000 per day (as of November 2021) for each variant.
Meanwhile, promotions at iPoker are, unfortunately, uninspiring and do not even begin to justify such large deductions.
Many might look at the way this pans out and use the word ‘fraud’ here, which is understandable but not entirely true. Nevertheless, the question as to whether these rake calculations are fair remains valid. Again and again it happens that players are angry with the poker room, but they can’t do anything about it and don’t know how – nor why – it is calculated in this way. Such decisions don’t come from the poker rooms that are part of iPoker or GG, but from the networks themselves.
With models like SBR and PVI, the poker room earns less, as does the affiliate, and the player receives less rakeback. Ultimately, only the network earns more. There’s no sugar-coating anything here – this is exactly how the situation is.
It’s annoying for everyone involved that there is what appears to be an unfair imbalance in the way rake is being dealt with, but it seems to be something that we have to accept. As we have already mentioned, the basic idea is not in itself wrong, and we would even support it if it were more transparent and a fair explanation of the relevant calculations basis was available. But it is far from fair that, for some players, in the worst case scenario only 50%-60% of the rake actually generated is counted for the poker room and the affiliate! Moreover, when we see that other providers such as Partypoker, Bwin, PokerStars, Unibet, WPN or Chico work in a way that isn’t so much to the detriment of everyone but the networks, the difference in how the respective companies operate is conspicuous.
Ironically, we can debate the fairness of the way rake is handled by GGNetwork, whether or not it should be deemed acceptable or total BS, but the model as a whole seems to be working, and the network continues to grow and grow. But a very valid and important question here is would the situation be equally as healthy without PVI? Maybe the numbers would rise even faster and – crucially – GG’s image and reputation in terms of how players are treated could be vastly improved.
It is now clear to everyone in the online poker industry how important it is that enough recreational players come along. A poker room that has only winning players cannot work. Nobody can deny this fact. But the big money comes from the regulars, and it is they who generate the rake and in turn ensure that the tables remain full, and it is this vital aspect that is all too often forgotten!