New iPoker Rake Structure

Understanding Old Rake, SBR and Real Player Value

Needless to say, the February 1, 2015 iPoker rake structure has left many affiliates and players quite confused. We have spent a lot of energy understanding the REAL effects and intricacies of the change, and the goal of this article is to educate the PLAYERS and AFFILIATES on the network on all important matters concerning the iPoker rake change.

We have received hundreds of inquiries on the rake change on a wide variety of topics, and we figured the best format for an educational piece such as this would be a Q&A of the most common / useful topics. We hope this helps you tremendously, and we are always available to help you with any additional questions or concerns regarding ANYTHING related to iPoker. Just get in touch with us.


What is the new iPoker rake structure?

On Feb 1st, iPoker dramatically changed the way they allocate RAKE to all cardrooms on the network. The new structure is referred to “Source Based Rake”, which is already misleading because the true formula really is only based 50% on “source” and 50% on “old rake” the network has used for quite some time. More on this below…


Bottom Line … what does it mean for me?

If you’re a winning player…

You can expect your Real Player Value drop by up to 50%. A 50% drop is very extreme, as it means you are a consistently winning players - likely winning far more than your rake is dropping.

If you’re a losing player…

Expect your Real Player Value to INCREASE, sometimes drastically. Because the formula is designed to attribute RPV based on the $$$ amount injected into the system, your RPV could go up any amount between 0% and 500% or even more. Imagine a scenario where you lose $1,000 very quickly, while generating only $1 of “old rake”. Your new Real Player Value may be as high as $1,000 over time. See below for different scenarios.

If you’re a break-even player…

Expect your Real Player Value to roughly stay the same. There will be cases where, in the short term, your RPV will be higher than “old rake”, and there will be cases that prove the opposite. It all comes down to what happens with the money you bring to the network, and HOW it happens.


Did the total amount of rake taken per hand change?

No - the rake taken is the same as it has been. The only thing that changed is who the rake value is attributed to.


Why did iPoker change the old structure?

The concept is simple: to encourage and motivate cardrooms to bring recreational poker players. Online poker, as a whole, has been suffering from a downward trend in liquidity over recent years, and iPoker believes strongly that this is the fault of a “poorly-designed” rake structure. iPoker wanted to encourage cardrooms to spend large budgets advertising online poker (duh), but the previous rake structure made it impossible to do so because the LOSING PLAYERS which are so important to a network’s ecology were worth too little. The end result would be that advertising campaigns would only LOSE money for the operators, so there wouldn’t be much advertising at all… this leads to a poor ecology, and ultimately less liquidity for the network. All bad things - it needed a dramatic change.

The new rake structure aims to change this trend and we are strong believers that it will work - here’s why:

  • Losing players will be worth more money to the card rooms.
  • This will make it easier for card rooms to get a positive ROI on their advertising campaigns for recreational players - the best players a card room / network can have.
  • If there is a positive ROI on ad campaigns, we can expect to see much more advertising. More advertising = more players on the network = more “recreational” money for players to win.
  • Also due to being worth more, card rooms will be able to more-aggressively award these players to keep them active. This is VERY good activity for the network.
  • Winning players will continue to play because they are winning - this should be the focal point of such players, rather than high % rakeback or promotional rewards as has been the case with previous rake structure.
  • The winning players who decide the lower bonuses (rakeback or otherwise) are no longer great enough will decide to play elsewhere (or not at all) which leaves the iPoker network more “fishy” as well (without these sharks) … another good thing for the network.

All the above is stated lightly as we are making many assumptions. But, this is the theory behind the dramatic rake change. The network will be much better for it. Bottom line, there will be a huge increase in liquidity over time because card rooms will be able to afford the advertising campaigns that bring the liquidity in the first place. And players will have a much greater chance at WINNING MONEY PLAYING POKER as a result.

Now … onto the details of the rake change and how you can stay on top of YOUR value and rewards.


What is SBR?

The foundation of the rake change is referred to as SBR or “Source Based Rake”. The name explains it quite well: attribute the rake taken to the SOURCE of the money that was used to generate the rake in the first place rather than the PLAYER that played the hand to generate the rake.

EXAMPLE:

Joe deposits $1,000 in poker room and then he loses $500 while playing poker. Because the SOURCE of the $500 that Joe lost is Joe, any rake generated later from that $500 he lost will be attributed to Joe EVEN IF the rake is generated by players other than Joe.

For this reason, Joe will continue to generate rake from this $500 forever until that money is either:
a) entirely raked
b) cashed out by players

This is the basis of Source-Based Rake, and to keep it simple just remember that the rake is attributed to the SOURCE of where the money came from. That’s it. This concept known as SBR is 50% of the new rake formula that began Feb 1, 2015.


What is OLD RAKE?

Old Rake, for lack of a better term, is the same rake you are used to seeing for years on iPoker. To keep it simple, we refer to it as Old Rake, but it’s really the weighted distribution of the rake. Unlike SOURCE-BASED rake, Old Rake is distributed amongst the PLAYERS that played in that hand, regardless of where the money came from.

Old rake is the other 50% of the new rake formula that began Feb 1, 2015.


In a nutshell, what is the difference between SBR and OLD RAKE?

Source Based Rake = rake is attributed to the SOURCE of the money used to generate rake

Old Rake = rake is attributed to the players that played the hand.


What is RPV?

Another acronym, but let’s keep it simple … RPV = Real Player Value.

Real Player Value is simply the term designated by iPoker to represent the player’s ACTUAL value to the card room, and is a combination of OLD RAKE and Souce-Based Rake (SBR).

RPV is what player bonuses and affiliate payments should be based on as this is the ACTUAL value the player has to the card room.


What is the actual formula used to calculate my rake under the new rake structure?

The formula for calculating Real Player Value is very simple, provided you know the SBR and OLD RAKE numbers.

RPV = (50% of SBR) + (50% of OLD RAKE)


How are rakeback and bonus schemes different with the new RPV system?

This is the next confusing part of the rake change. Not only do players not know how much rake they are generating, but many card rooms have also significantly dropped player reward deals in order to cover themselves and increase profit margins.

Unfortunately, most card rooms don’t provide players with the knowledge / transparency they need to accurately assess their value. This is what we aim to solve with PokerBills.com … by providing you with the tools you need to know your value, you will be able to make the most informed decisions about where you play your online poker.

Our CRITICAL piece of advice: if you value your rewards (and you should!) do NOT play at a card room that does not allow you to track your Real Player Value. You deserve to know, and you deserve to be rewarded accordingly!


Ok, so how do I know my SBR, OLD RAKE and RPV numbers?

The RPV formula makes more sense - it’s more logical in every way. It encourages activity that will propel the iPoker network in the right direction. But because of the many moving parts, it is now more important than ever to have proper tracking tools to know YOUR Real Player Value.

Software tools (like Holdem Manager, etc) no longer work. Card-rooms do not yet have tools for making data transparent, and perhaps they won’t strive to as the focus is now on recreational players. However, this leave a big hole for players that WE care about … and if you’re reading this article, we’re guessing that’s you.

We have created PokerBills.com which will provide iPoker players with a 100% reliable tracking tool for seeing stats by date for any timeframe you wish.


PokerBills.com provides the following for your account:

  • Source Based Rake
  • Old Rake
  • Real Player Value
  • “Tagged Money” to you that will continue to generate rake in the future

Still confused? Sometimes the best way to understand a new concept is through real-life examples. The examples below should paint a clear picture of SBR, Old Rake and how they come together to form Real Player Value.


Example #1:

Player A loses $1,000 to Player B while playing on iPoker and generating $100 of “old rake”

How is Player A’s “Old Rake” calculated in the new formula?

Same as always - weighted distribution. The “Old Rake” portion in the new formula will still be $100 for Player A.

How is Player A’s SBR calculated in the new formula?

This is where it can be a bit confusing. The answer is … it depends on where the $1,000 ORIGINALLY came from that Player A lost. See the scenarios below.


Scenario A: the money came from Player A deposit…

If Player A deposited the $1,000 and lost it to Player B, it’s simple … Player A is the “source” and therefore the rake ($100) is attributed 100% to him.

Player A Old Rake = $100

Player A SBR = $100 (since Player A’s deposit is the source of the rake)

Player A Real Player Value = 50% of Old Rake + 50% of SBR = $50 + $50 = $100

But here’s the kicker … since player A is the SOURCE of the $1,000 that he just lost to Player B, any future rake generated from Player B using the $1,000 he just won from Player A will also continue to generate SBR rake for Player A until the end of time! For this reason, it’s possible that the SBR portion of rake, over time, for Player A will reach as high as $1,000.

So, this is what the new formula could have Player A Real Player Value looking like in the long run:

Player A Old Rake = $100

Player A SBR = $1,000

Player A Real Player Value = 50% of Old + 50% of SBR = $50 + $500 = $550

So, Player A raked $100 in the old system, yet now is worth $550 on the new system. This is the type of activity iPoker wants to encourage!


Scenario B: Player A won this $1,000 from another player … Player C

If Player A won this $1,000 previously from Player C, then 100% of the rake is attributed to Player C, and therefore Player B will have $0 of SBR rake attributed to him.

Old Rake: $100

SBR Rake: $0 (100% of the rake will be attributed to Player C, since he is the source)

Player A Real Player Value: 50% of Old + 50% of SBR = $50 + $0 = $50 RPV

Player A has a Real Player Value of $50 in this scenario. It’s significantly lower than “old rake” because he generated the rake using money he WON from someone else (Player C). Player C will continue to earn SBR rake from the $1,000 he injected into the system!


Scenario C: Player A won this $1,000 from many players

If Player A won the $1,000 previously from many players (even 10 or 100 players), then 100% of the rake is distributed to ALL the players he won the money from.

Player A Old Rake = $100

Player A SBR = $0 (100% of the rake will be distributed to the SOURCE of this $1,000 he won originally, even if it is many players!)

Player A Real Player Value = 50% of Old Rake + 50% of SBR = $50 + $0 = $50




It’s important to note that in ALL the scenarios above, the same total rake is taken ($100). The only thing that changes is WHICH PLAYER(S) the rake gets attributed to!


In Conclusion...

We sincerely hope the above helps your understanding of the new and improved Real Player Value rake structure on the iPoker Network. It can be confusing to determine your true value, which is why we strongly encourage you to ONLY play at a room where you can track your SBR, RPV, and money tagged to you “in the system” that will be generated as future SBR rake for you to benefit from.

If you have further questions on SBR, RPV or anything else related to iPoker, get in touch with us and we will help you.


Most importantly, if you are not a member of PokerBills.com yet, you should sign up so you can track these  important elements that directly impact your player rewards! It will make understanding this new world of RPV much, much easier!