blonde poker forum

Let's take for example GUKPT, UKIPT & DTD events that are buyins around the £1k mark.

Do you think these tournaments would be looked upon differently if they potentially dropped the £100 rake?

Personally I think it would make next to zero difference if it was £1070 vs £1100.
Rake free would be a usp and would probably attract some attention, initially at least.

Not noticeably. Size of buyin, location, prizepool affects turnout, probably in that order

IMO, it would not make a dot of difference, except to the Cardrooms, who would be less inclined to run them, & offer worse value in other ways to offset the loss.

We want to be charged a fair fee, but we need the Cardrooms to be properly rewarded, too. 

What would the response be if they made them £1K+£200?

dropping off £100 completely would be great as a one off, surely? It could be there to experiment, I appreciate that x,y,z card toom has to make money, but perhaps when some of the events are struggling to make the money and dropping tens of thousands that maybe testing the water with dropping the reg fee completely as a one off would maybe see them make the guarantee?

I think someone made a good point about the rake for the £100+£20 though - I think if it wasn't for the decent guarantee they wouldn't make it, so I don't know *shrug*

Away from the big comps I do however see that the local comps that are less than £30 buyin now are minimum £5 rake, there is even £5 rake on £10 tournaments too

In Vegas, away from the WSOP, the rake is far higher than here.

For their various Summer Series......

Orleans charge up to 19%

Golden Nugget charge up to 20%

Planet Hollywood charge up to 29%. (the min reg feee for sub $200 is 22.4%)

Venetian charge up to 18%. 

I've not seen Binions 2015 Summer Series yet, but they'll average 20%.

Some of those numbers include almost mandatory extras, such as "Dealer/Staff Bonus", which entitles us to additional chips.

In my experience, it does not seem to affect the numbers playing.

I think what they charge is usually fair. They have to cover wages, utilities, licenses costs ect.... I would say they probably might even make a loss basing costs VS reg fee. Of course they should make money through other streams through, Food & Drink, Table games and other ventures.

Agree with Tikay, if they stopped charging Reg fees they would be eating too deeply into their margins and would have to stop running them.  

The rake is irrelevant to some, as they never cash, Matt The Hoople being a perfect example.

A GUKPT is 1000+90.

A UKIPT is effectively 970+130

So I guess I would choose the GUKPT

Think I have played 20 GUKPTs, one UKIPT.  I know Neil has mentioned avoiding the high rake before too.  UKIPT seems to have dropped the extra day, so maybe I'll play a 2nd soon.  Rake, distance and days all make a difference. 

but all other things are not equal though

just taking this UKIPT (accepting that for some the guarantees are lower, that the locations are trickier, that some of the tour's policies don't appeal to some etc)

GUKPT gte £200k, UKIPT gte £1m

part of the issue here is that the venue is taking on a significant "nosebleed" guarantees. sometimes it works, occasionally it doesn't but i don't think a higher return for the venue (which if it is higher rake would get swamped if they miss the guarantee wide anyway) is inconsistent with the bigger risk.

I would agree, however I would say that anything that DTD does should come with and asterisk because Mr Yong has more guts than most other people running poker.

Recently there was a UKIPT and a GUKPT in London back to back. For me it was no contest. But you pays your money and you takes your choice.

I would say a decision to play a tournament should come down to a mixture of finding your highest ROI and your best player experience. However those two things are weighted will vary from person to person.

Personally I don't live in the UK mostly, so I will sometimes plan my trips back the same week so I can play a tournament.

I don't mind playing smaller tournaments because I think I play final tables well and have a good understanding of ICM. So smaller fields, more final tables and in theory less variance. To get that I feel ok sometimes sacrificing a chance of a big bink.

The headline figure is absolutely unimportant, it is all about the ROI.

To be fair I have played a couple of events at DTD I wouldn't have elsewhere. 

the headline figure is important to some, less so to others

similarly the rake, way down the list to some, more important to others

as everyone is saying its a range of factors but the headline figure/opportunity for a big bink is, i would suggest, important to lots of players

Let's get one thing straight from the outset because so many people seem to forget this. These places are not there for our poker playing pleasure, they're businesses plain and simple and if they fail to make a profit they will disappear.

The costs of running a cardroom will have increased dramatically over the years so why wouldn't we expect the rake to increase?

If we take a nice £100 + £10 comp running ten years ago that nobody would have complained about:

Assume a nice steady 3% inflation over ten years and that £10 rake now needs to be £13.50 to cover the same costs. Unfortunately £100 + £10.30 in year one through to £100 + £13.50 would cause uproar in the poker community so they leave it at £100 + £10 for as long as they possibly can.

There's always been the problem that some comps will subsidise others. As far as costs are concerned a £10 + £1 comp will lose a small fortune, a £1000 + £100 will make a small fortune and at a guess a £200 + £20 will about break even. A place like DTD gets around this a little bit by having the £5 minimum rake.

If you look at a typical good night at DTD. 150 runners paying £5 each so approximately £750 going in to the DTD coffers..... You think that covers the cost of opening the doors for the 8 hours the comp runs for? Of course it doesn't but they still do it because somewhere down the line there will be a festival, a grand prix or a UKIPT etc. that will subsidise it.

During these festivals I'd imagine that DTD does very well and makes a good profit as long as it hits its guarantees. During the rest of the year it won't fair anywhere near as well.

Every business has to make the most of the good times so that it an ride out the bad times. Festivals are good times so I'm afraid they have to subsidise the bad times.

In direct response to the original question the answer is a resounding NO!!

Loss leaders in a market place that appears to have zero loyalty are a sure fire way to destroy a business.

Agree with this completely.

This is completely true.

£1000 + £100 or £100 + £1000 it really makes no difference.

Sat costs dwarf the "profit" these make.

 I imagine the cash/casino part of DTD do well and the tournament side horrifically, with online being the real money maker.

I don't think they have been making much money online?
Unless I am mistaken the only things that run are satellites and most of those have overlays?

As Tikay said earlier, we are all acceptable of paying higher rake abroad.

I presume it costs the same to run a £100 tourney as a £1000, so maybe a sliding scale to make it more appropriate, especially if the rake is in effect to covers costs?

The point about inflation is not quite right IMO>

With inflation the buyin should increase at the same rate as the rake.

But there is no reason to increase the % of buy in paid in rake.

In your example it should be £103 + £10.30 after year one etc etc

As regards to the OP.

I certainly play GUKPTs more than UKIPTs because I appreciate the fact that Grosvenor keep the rake lower.

Pokerstars take too much out and I absolutely hate the fact they withhold 3% for dealers. This is England not America.

I would and do tip if I make the final table (and I think the dealers have been good - which they always are in Stars events), but taking a % of a mincash is out of line IMO.

Stars makes fortune in juice from online sats and for them to charge more rake than Grosvenor who make a fraction of the money Stars do from sats just proves what great value the GUKPT is.

I'm pretty sure Stars started the EPT and UKIPT events to be live advertising for their online product.

Now they are just another cash cow.

Indeed - if they don't put up buy ins then effectively 5/10 years down the line you are offering an £80 tournament when you used to offer a £100 tournament (depending on inflation rate).  In theory you should get more runners and higher total rake as the buy in is lower compared to people's salaries.

So you can either do that or increase the whole buy in (and thus rake) by inflation and both should cover any inflation in cardrooms' expenses.  If you just increase the rake by inflation then you are offering a worse deal.

I know what you're saying but it's the fact that the tournaments combined throughout the year have to cover overall running costs that matters.

Say a club runs the following comps in year one:

50 x £100 + £10
100 x £50 + £5
100 x £25 + £5
4 x £1000 + £100

Assume each one gets 100 runners so total rake is £190k

After 10 years that rake needs to be £256k all other things remaining equal.

So they can either have the following:

50 x £135 + £13.50
100 x £67.50 + £6.75
100 x £33.75 + £6.75
4 x £1350 + £135

Or just leave that lot as they were and have a couple of insane guarantee festivals where everyone has to pay an extra bit of rake twice a year. Bear in mind they aren't forced to play, they can play the others that are on every other week for the usual 10% rake but without the insane guarantees.

So given the fact that the insane guarantee festivals don't upset too many people (as they keep meeting these ridiculous guarantees) which is the most practical?

No

Is the average price of tourney buyins going up anyway though?  Go back ten years and a £100 comp was a special event, the local comps were £10 - £25.  Now the weekly casino comps are £25-£100 with no one really batting an eyelid untill a buyin gets over the £300 mark.

Love it :-)

And if I'm not mistaken under gaming law rake is treated as all gambling take is treated; the government takes 50%. So a rake total for the house might be 20k in a big tournament, but its actually 10k they will see to cover costs....

Fwiw I think £100+20 for the ukipt mini is ridiculous.  Regardless of what the standard juice is anywhere else in the world, 20% is taking the piss imo.  Big Guarentee or not.

Judging by the turnout it appears the general public may well agree.

The Grosvenor Student thing will have had a pretty big impact, as well as GPS Newcastle plus being in the middle of the UKPC Mini and the Grand Prix Million.

Can't see many people turning down the prize pool on offer plus the professionalism of the event/DTD based on the increase in rake....some of course but not many.

to say people dont care about the rake is certainly incorrect, to say it's peoples primary motivation for where and what to play would be also, imo.

i like the idea of 10% taken from the prize pool to cover costs etc so making the ukipt just £1000 to enter....yes those that cash get a little less mainly impacting first place finish....

I think the thing with comps like this is to a big % of players it is a multiple bullet event which they treat like a £200 or £300 or maybe £500 event over the long term so they are playing it as a £200+£40 or £300+£60 which is when the 20% rake really does start looking insane.  I understand all the gtd issues etc and the risk/reward profile the casino is taking putting on with huge gtd's.  The reality is though the casinos are not seeing this additional rake.  It is directly going to the government.

I think what the increases in rake does show with the 50% of rake going to the government in tax that poker players are effectively taxed at source via the rake box whether they win or lose on playing an event.  Over a year a decent live grinder will pay a huge amount of tax to the government yet constantly be told they don't pay any tax on their income.  The £100+£20 events are effectively £100+£10 like the old days with the extra £10 going straight to the government.  

At £100 mtt level it isn't such a big deal.  However when £1k events are now minimum £100 rake when they were £50 6 years ago (capped at £15 10/20 years ago whatever the buy in) it just shows the amounts of money the government are forcing casinos to charge now to cover their costs yet the casinos are made to be the bad guys with customers.

Stars charge 10% then 3% on top for the dealers then ask for tips after.  Plenty of firms doing £1k buy ins at £900 + £100 (11.1% rake).  All trying different ways to squeeze more out of the punter in order to pay their increased tax bills to the government.  

As the standard of play gets higher and higher and the edges in games get smaller and smaller as the cost of playing (rake) increases to the customer (even though the actual rake retained by the casino after tax stays the same or actually falls) it would be total folly to think a decent % of rational business like customers don't reassess their poker investments over a year and reduce their expenditure.  

Where do you get your tax facts from? If it's an accountant I think you should look for a new one.

I get my tax facts from https://www.gov.uk/government/publications/excise-notice-453-gaming-duty/excise-notice-453-gaming-duty

I find it's the best place if you want to make public statements that may get checked out by other people.

The gambling tax isn't 50% on everything, it's up to 50% depending on gross gaming yield in a 6 month period and it's also tiered.

Up to £2.3M is 15%
The next £1.6M is 20%
The next £2.8M is 30%
The next £5.9M is 40%
The remainder is 50%

From the HMRC website:

The ‘gross gaming yield’ consists of:
•the total value of the stakes, minus players winnings, on games in which the house is the banker, and
•any charges made in connection with dutiable gaming, including charges made for participation in equal chance games such as poker

I'm no accountant but the statement above suggests that the tax is on the profit the casino makes from it's gaming tables and also the rake from poker tournaments.

Now I obviously don't know DTD's figures but I'm pretty sure they'd be chuffed to bits if they were yielding enough to be paying that 50%

You are probably correct regarding DTD as it is a stand alone operation but any mtt played in any main chain casino (Grovs/Genting etc) in the UK where their gaming profits will be easily the top limit for tax reasons your rake will be charged at 50% by the government for tax.  Channing tweeted/wrote in his bluff column ages ago when the tax change came in that the Vic raked around £5m a year and the government were taking half of that straight off the bat and it was getting to the point where the Vic were considering whether the floor space used by the cardroom made it economically viable to keep the cardroom going as they only kept £2.5m before any of their actual business costs were covered.

It's not though really is it.  It's unique to poker where the ABI has not moved in line with inflation over the past 20 years.  DTD have significant costs - as do other "card rooms" - and the ABI of comps ran has not kept pace with inflation - so it can't run at a static 10% unless something changes in the business model economics. £10 in 1995 when i started playing is worth £20 now.  The smaller comps always make less margin that the higher buy in ones and it just isn't sustainable without support from cash games, casino. 

I think poker players generally love a moan and are quite self centred with their views and see it as a one way street.  Course I'd rather pay as little rake as possible and get maximum value however we all need to be realistic.

So Channing is your tax advisor? Must be true then if he tweeted it.

Why would you apportion the entire 50% band to your poker profits? Surely as a business you'd treat it as a percentage of your total profit and therefore part of that £5M would be taxed in the lower bands?

If they don't then all it's doing is moving another part of the casinos profits back in to a lower band.

What The Vic are really getting at is that poker is nowhere near as profitable as the rest of their business so they'd prefer to use the space for roulette or blackjack. They use the tax angle to garner a bit of sympathy for when the inevitable happens and they get rid of poker and replace it with blackjack and roulette. They'll still be paying the same tax on those tables but it'll be on a bigger profit so they're happy.

Have a quick look at this: http://www.rank.com/our_industry/taxation.jsp

The only reason they can say poker profits are taxed at 50% is because of the £12.2M+ profit (in a 6 month period) that they're making anyway!!!

If they made less profit on everything else they'd pay less tax on the poker tables so don't blame the government for this one.

The original question asked if dropping the rake in big buy in live mtt's would increase numbers attending.  We are getting away from the original question here.  The bottom line is the government's taxation policy has forced the vast majority of operators to increase their rake charged on these events in order to make as much money before on these events.  GUKPT's started at £1000+50 and have steady risen year on year in the past 8 years for example.  It is pretty hard to not see part of the reason for this is the government's taxation policy.  It might not be the only reason but it certainly plays a part.  To not partly blame the Government for this would be wrong imo.

Any product in the world is subject to different levels of price elasticity.  Many would argue poker rake on big buy in mtts is relatively price inelastic but there will be a certain fall in demand when the cost of the product increases to the price sensitive customer which there are a decent chunk of i would imagine at this type of buy in level.  Therefore to answer the question dropping the rake would increase numbers.  To what level is open to debate.  Several people have stated openly on here they refuse to play poker stars 10% + 3% dealers 'rake' comps so it does make a difference to demand for these products.

It's not a tax on profit. Gaming duty on roulette is calculated differently to poker.

It's a tax on revenue. Any session charge, rake etc is taxed up to a maximum of 50%.

When you consider the other costs involved in poker (it's very staff intensive given the limited scope for revenue generation) it makes it a difficult business model.

I've edited to add this:

Roulette Table #1

Drop/Handle: £500,000
Player Wins: £100,000
Taxable Gross: £400,000

Poker Room #1

100 x £10 charge £1,000
Rake revenue of £2,000
Taxable Gross: £3,000

One is profit. Poker is all revenue generated.

It's a significant difference.

That roulette table is rigged.