Why is SNG rake so high?

[billxo1b]

a doom/boom switch is the best way to keep the fish population healthy.

[fluorescenthippo]

the interesting thing is not how high sng rake is but how low cash rake is. like the OP said the rake at 25/50 nl is almost nothing. why havent they made that rake 5 - 10 times as much? they easily could and much less percentage of people in the games would care. the pros are still crushing it for $200/hr+ and the fish are still fish.

[fluorescenthippo]

i tried to read all posts but might have missed if it was already said.

anyways the answer is not to reduce rake. it is to increase FPPs/rakeback. then the fish get a bonus!!!! just like WPEX

[Ditch Digger]

I'd actually deposit some money on WPEX if they had any higher buy in SNG's(they currently don't have any $30+ 10 person SNG's).

[DerrtySlime]

what is the most effective way we can get pokerstars and fulltilt ( or just one) to lower they're rake?

just 1 idea: 2+2 pocketfives ( they could help us!) could run a banner ad advertising less rake in they're sngs. I think these two web based poker forums are interested in helping the player so i think they could help us out here. Also, when pokerstars sets up they have news announcements about they're site, promotions, Pokerstars team players doing well in various tournaments around the world that they show off to EVRYBODY who opens up stars, which would reach a lot of poeple.

[KoreanBuffet]

ppl at p5's would just spam the thread with the idea about how they pay up to a 100% entry fee b/c they all have 150% ROI over 10 million games.

[DCJ311]

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if stars lowered their rake to acceptable levels, i think we could agree that this would benefit everyone, and stars would probably not lose money.

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This is far from a given. Read Lee Jones email in the previous thread (link I posted above). He's very concerned about "overfishing" ruining the environment for everyone.

Rake and VIP programs are his primary methods of maintaining this balance between sharks and fish. Obviously they have these set where they are right now because they think it's the most profitable configuration - now and long term. They could be wrong but I guarantee they've put a lot more thought into it than we have.

Lowering the rake might bring some more business, but at least short term it would seem most of that business would be pros. I would guess whatever change they do make needs to be very gradual so that the ecosystem has time to adjust.

I think basically their strategy is to use the VIP program to keep their super high-volume pros, the ones who seed a lot of the bigger SNGs, happy - w/o making the playing field so juicy that it induces 100s more like them to sit down and kill the games.

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Lee Jones' comment about 'overfishing' is absolutely idiotic. Why should they give a rats' ass if all the players from $25/50 cash games quit and move to $225+ sngs? It's in their best interest since they'll make more money.

Furthermore, the high stakes SNGs are killed ALREADY! The $335s and up barely ever go as it is, the $225s and $114s aren't what they used to be, and it will get worse before it gets better.

It's abundantly clear that they're far better off charging $1050+20 for a SNG than charging $1050+50 and getting almost 0 action per day, yet they continue to implement the same flawed system. I don't even want to get into 6-max and HU sngs, which are even more disgracefully raked.

At the lower stakes, there's going to be a lot more fish regardless of the rake and the games will still be profitable even with a 10% vig.

The real problem comes at the $55+5 and up levels, where there is potential to get nearly as much volume as in the lower stakes SNGs assuming the rake were lowered significantly. By taking a 7-9% vig in a pool that naturally will contain less fish, they ensure themselves of offering a game that is nearly unbeatable and therefore unplayable, FPP promotions or not.

If they lower the vig to about 2-4% across the board, they'll get overwhelmingly more players, as well as the multi-tabling players who can put up 8-12 tables at a time and play 100+ SNGs a day.

The whole key with SNGs is that they refresh so quickly and have a great turnover rate, which is why sites should be doing everything in their power to get players to play them. There's also less legitimate 'dead money' in them unlike MTTs, so it takes longer for true fish to go broke.

Pokerstars and Full Tilt are absolutely NOT outthinking us on this one, it's just an idiotic business model especially at the high stakes levels.

Let's say a $25/50 NL table generates 100 HPH and has an average pot of $700. Let's hypothesize that each hand generates a $3 rake. So they make $300 per hour in rake on $70,000 of money being pushed into the middle per hour.

Compare that with a 9 person $525+30 sng that generates roughly the same rake per hour for them with only $4725 of players' money being invested per hour. It's absolutely ludicrous and no argument from their staff can convince me otherwise.

I have been Supernova for the past 2 years and was even offered a position working for Pokerstars at one point, so it's not like they ignore my emails. I am all for a site boycott at least on SNGs, let's keep this thread alive and try to make some progress.

Be sure to send pokerstars emails and voice your concerns, if enough high stakes players push hard enough perhaps they'll do something.

[Kevin8423]

Obviously its because they get infinite SNG traffic on their site with the current rake, so why would they ever change it? It really isn't that hard to understand, although it is unfortunate especially for high volume players.

[ryanghall]

Kevin, did you read anything that has been written in the thread or are you a simpleton? Obviously they make money the way it is set up now. We're saying they could make more.

Ryan

[Kevin8423]

I skimmed, and I saw arguements that SNG rake could be lowered and that 25/50 cash games have an extremely low rake. SNG rake won't be lowered because they currently get a huge amount of players paying it, and cash game rake is irrelevant to SNG rake. If anyone is arguing that SNG rake should or could be higher than I missed it I guess.