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Kudos to Karim for calling it like it is.

Wilkins said: “These days networks like iPoker, Entraction, Boss and Microgaming will seemingly give an online skin to anyone with a few hundred dollars and a small database of players. And it’s a majority of these skins that are cannibalising existing network traffic, by contacting players through player chat at the tables and so forth in order to poach them across for higher rakeback”.

That’s almost exactly what I was saying in my previous post.

Rakeback [what is rakeback?] isn’t a big problem for a stand-alone room because they can decide whether or not to offer it. If they choose wrong then it’s on them.

But when you get into a network scenario, things get more complicated. Wilkins is right. Anybody with some cash can open up a poker room on a network even if his name is IPlan OnOffering Rakeback.” And as Wilkins implies, within the industry we all know who is doing shady deals under the table. The players tend to send in the emails and ask for their current room to match the deal being offered before they leave.

The fact that the networks aren’t cracking down on rouge licensees shouldn’t be a rallying call for the industry to reject rakeback. It has very little to do with rakeback. It’s about stealing players unfairly. It’s about all the licensees on a network agreeing to a set of rules put forth by the network operator and then some licensees going off and violating the rules while the network operator looks the other way.

Rakeback is really no different than a loyalty program that allows players to take cash for points. Even PartyPoker announced that that their new loyalty program was equivalent to 40% rakeback. And that’s a H-U-G-E change for Party where even saying the word rakeback would get you dirty looks in the office.

Instead of Mr. Marcus calling for the banning of rakeback he should be calling for network operators and network licensees to come up with a viable plan. For instance, why don’t they do split rev sharing on a player who moves from Room A to Room B? If Room B steals the player from Room A but has to split the earnings from the player 50/50 he won’t be able to make a profit. But if the player migrated there himself, 50% is better than nothing.

Network operators and licensees really need to get their act together because if they keep blaming rakeback and ignoring the real problems then they’re going to lose focus of where the industry is going and will soon find themselves unable to compete.