Even experienced players often don’t know what Netrake is, nor how it is calculated
The topic of Netrake(NGR) comes up often and causes confusion among some online poker players. Since we are asked about it regularly at YPD, here is an article explaining everything you need to know about Netrake.
First, players themselves have nothing directly to do with Netrake, rather it’s a crucial element for us as an affiliate because it helps determine how we are paid by our partner online poker rooms. This applies to every affiliate, and different deals/races/promotions and so on are rated based on a player’s Netrake also called NGR.
How is Netrake calculated?
The calculation of the Netrake is actually quite simple. You take the generated rake and subtract whatever costs there are from it. However, there are minor differences depending on the poker room, as there are certain costs that some poker rooms do not deduct and pay for themselves, while others deduct everything.
For easier understanding, we would like to illustrate the calculation using the example with GGPoker/Natural8:
Rake (After deducting PVI) – Fish Buffet/Platinum Weekly Status(Rakeback) – Welcome Bonus – Transaction Fees – Tournament Overlay(MTT) – MTT Tickets won – Tax(Depending on country) = Netrake(NGR) The affiliate is paid based on this amount and we also use this value for our internal promotions and VIP System.
GG network promotions, such as the daily rake races or jackpots, do not influence a player’s netrake!
Now WPTGlobal to take another poker room and have a comparison.
Rake – Rakeback – Welcome Bonus – Transaction Fees – All Promotions – Tax (Depending on the country) Netrake(NGR) The affiliate is paid based on this amount and we also use this value for our internal promotions and VIP System.
What is the big difference here between the two poker sites? WPTGlobal has no PVI, which means 1$ Rake will always stay 1$ Rake, which makes the calculation easier and transparent. They also don’t deduct any MTT overlays. But besides these two points, all is the same.
Online poker rooms are also different when it comes to fees. Those operators who have a more reasonable approach take 1- 2.5% for each transaction via Skrill/Neteller, while with others it might be between 4% and 7%. Regarding this topic, we recently featured an article about the hidden costs that an affiliate has to pay.
Netrake determines how much an affiliate earns and the extent to which exclusive promotions/deals/tournaments can be offered
Some might think that an affiliate earns enormous amounts because players can generate a lot of rake. However, this isn’t at all the reality given what is deducted, and that the affiliate receives only a share of the Netrake.
Everything has to be calculated and it is therefore an advantage for many affiliates if certain promotions are calculated and paid based on the Netrake.
If Netrake is negative, there’s a negative impact on the affiliate
Importantly, if the cost and Rakeback are higher than the rake generated, then Netrake is negative. In this case, an affiliate has to pay the same amount as if Netrake were positive.
A simple example: Let’s say the affiliate gets 30% of a player’s $100 Netrake. The affiliate will receive $30 commission. However, if the Netrake is minus $100, the affiliate pays $30 and it will be automatically deducted. Thats why affiliate promotions, especially at YourPokerDream but also at other affiliates are usualyl based on the generated Netrake(NGR) of a player.
The more Rakeback a player receives from the poker room through the usual VIP system and promotions, the smaller the profit margin for the affiliate. Even if a promotion is based on a player’s Netrake, the affiliate would not have to pay out anything to the player, but would still make a loss.
In the long term, the Netrake is always positive for players, especially those who have just joined a poker room or those who switch from site to site to join numerous promotions, constantly depositing and withdrawing funds.
