Winning Players Banned - Blackjack Syndrome in Online Poker
Online poker players being penalized for winning. Is this a blackjack syndrome - "winners will be banned" - or a way for poker networks to control the fish-to-shark ratio?
Numbers of online poker players have been blocked from their favorite cash games at iPoker skins. The reason: they were winning players.
Behind this surprising (and illegal?) action from some sites in the iPoker network lies a desperate need to deal with the "rakeback problem".
The rakeback problem
The financial margins of many online poker rooms have been under attack in the last years, all because of illegal rakeback deals.
Even though the poker networks prohibit rakeback (Party Poker, PokerStars, Microgaming, Everest Poker, Ongame), many skins have continued to offer their players generous rakeback deals under the table.
After all, rakeback is a very effective marketing channel. Many pros and semi-pro grinders have made a living off this kind of deals. Anything less generous would imply a big cut in their income.
The problem is that the rakeback reduces the margins for both skins and networks. This has even made it hard for some of them to survive the harsh times of financial crisis.
Downward spiral of illegal rakeback
Sites that don't offer illegal rakeback deals have lost their customers to those that do. Money that could have been spent on regular marketing to attract casual (losing) players has been spent on attracting sharks - players who withdraw more than they deposit and thereby shrinks the poker economy.
All in all, the "rakeback problem" has been a real headache for the poker industry. A couple of months ago, newly started Bodog Network announced a solution to the rakeback problem, a way to calculate rake that rewards the skins in the network for recruiting losing players rather than winners.
"Winning players ... will be worth so little that there is no point competing for them", says Jonas Ödman at Bodog Network. "This will create a much better poker economy for all: operators, affiliates and poker players."
We haven't seen this solution in action yet, as the network is still under construction, but what's been happening over at iPoker might just be a way of following the lead of Bodog Network.
"We will not block winning players"
But whatever lies hidden in the new Bodog formula, blocking individual players from playing isn't part of it according to Bodog Network CEO, Patrik Selin:
"The operators that appear to be trying to copy our model have missed the point. We will not be blocking winning players from our network - in fact we will be very attractive to them and will welcome them with open arms."
Reduced rake an alternative solution
We'll see what comes out of all this. But at Poker Junkie we feel that one way to attract casual players would be to decrease the rake at lower stakes.
In this way, bad players would last longer, have more fun, be less frustrated and in the long run lose all their money to the poker economy anyway.
Exposing new players to the most brutal rake cannot be the best way to make casual players stay in the fish tank.
PS Also, if you manage to bring in only losing players to the network - who will they lose to?