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The Fallout From The Full Tilt / PokerStars Pullout

Bill Rini — Sun, 17 Apr 2011 04:52:29 +0000

I said I was going to cover what this all means on a few topics when I got home and as I start to write this it’s 6:07am and I’ve just spent a sleepless night on the bus from Phetchabun so I’ll probably just do a quick draft and finish up after I get a chance to sleep a bit.

First off, I want to clear up a widespread misconception. Although the people named in the indictment are being charged with violating the UIGEA they’re also being charged with bank fraud and money laundering. Those last two are serious enough to take down Stars and Tilt if they prove to be true. People like the PPA are making flawed statements like this:

“Millions of Americans across the country today are outraged over the U.S. Department of Justice’s clear attack on internet poker. While the government’s focus may be on the companieswho operate these games, this is plain and simple a declaration of war on poker players and poker players’ freedoms. Not only are the over 10 million online poker players left without a place to play the game they enjoy, and from which many earn their livelihood, but they also haveconcerns over the availability of their funds. The PPA believes that no players’ money should be jeopardized by this prosecution.”

Yeah, that’s all good and all but they’re being charged with bank fraud and money laundering. What should the DOJ do? Let them continue to take money from US players while engaging in a alleged crime because it might inconvenience some players? What if their companies were a front for drug smuggling or human trafficking? Should poker players’ “right” to play poker trump all else?

Don’t get me wrong, I wish this hadn’t happened as much as anybody else but you don’t help the cause by trying to gloss over the fact that they’re being accused of some pretty serious crimes. Yes, it is the position of the DOJ that they were also in violation of the UIGEA and offering illegal gambling BUT the DOJ probably would have never done what it did without the money laundering and bank fraud charges. If they did what they are accused of doing, it is Full Tilt, PokerStars, and Absolute/UB who are the ones who have taken away online poker from players via their illegal actions involving money laundering and bank fraud.

The PPA and poker players should be focused on the fact that the UIGEA forced these companies into taking such drastic measures and that a fully regulated and legal online poker scheme would eliminate the need for such activities. That’s the message they should be delivering to the media and to lawmakers. You can’t just ignore that they broke a bunch of laws (allegedly) because people want to play poker.

Another widely accepted opinion I disagree with is that Stars and Tilt might be able to walk away with this with a fine. I don’t think so. They might be able to buy themselves out like Party and Anarag Dikshit did but that was for offering illegal gaming in the US prior to the UIGEA. That’s a whole separate case. Plus, again, it doesn’t take into account that neither Party or Dikshit were indicted on money laundering or bank fraud charges.

Keep in mind that the DOJ is looking for “at least $3bn in civil money laundering penalties and forfeiture from the poker companies and the defendants.” “At least” is a pretty scary word because that’s the starting bid.

Anyway, with that out of my system . . .

Affiliates

I think Jeremy Enke said it best in his blog post about what the fallout will be for affiliates. In summary, affiliates probably shouldn’t be worried about criminal charges. We aren’t payment processors and that’s what the indictments were targeting.

Obviously, this is going to hit the revenue streams of a lot of people though. But just like any other market shakeup it will produce winners and losers. Some people will adapt and some people won’t.

The biggest issue is that few sites are going to pay for US players and that is the bulk of the earnings for many affiliates. Anybody who hasn’t at least been dabbling in non US-facing traffic is going to have a bit learning curve to get over.

In the meantime, I think the biggest question is what happens if I send a player to PokerStars.eu? Does it get tracked or do I need to set up a new affiliate account? Stuff like this is happening way too fast for sites like Stars and Tilt to respond but it needs to get cleared up soon so affiliates know.

WSOP

I saw someone on 2+2 (sorry, no link as it’s buried in a 5 zillion page thread) compare the impact on the WSOP to the impact that the UIGEA had on the WSOP. In other words, little or no real impact. I disagree. When Party left the market it was months prior to the WSOP (October 2006) giving the market time to respond. And when Party left Stars and Tilt were more than happy to step in and fill the void.

But who will fill the void now? I don’t see many people having the balls to try to send 500 or 1000 US players to the WSOP Main Event. Not when people expect a hospitality suite, onsite handling by the room, etc, etc.

I also don’t think Stars or Tilt are going to be very active trying to sign up final table players like they have been in the past. In fact, I wouldn’t be surprised if they didn’t send anybody even remotely connected to the company to the WSOP. If nobody from either Stars or Tilt has been arrested or extradited by the WSOP the DOJ might just want to send a message about how serious they are by nabbing an employee to drive home the message that Stars and Tilt are finished in the US. I don’t think they can make much stick on a low level employee but it will send shivers up a few spines across the pond (and South of the border).

Players

Players are screwed. Everybody already knows how hard it was to get payments processed with US players and few operators are going to take the risk. There might be some fly by night operators thinking they can cruise under the radar but just like back in the early sports betting days you may never see a payout.

There are still a few sites like Cake and Merge that will handle US players and many US players will flock over there but I don’t necessarily think you’ll see non-US players following suit like they did when Party left the US market. I think many non-US players will gravitate towards quality and iPoker, Party, and other sites will see an increase in non-US players.

As always, even with Cake and Merge, the bottleneck is going to be payment processing. When you don’t do many payments you can fly under the radar but if players start flocking to those sites then a lot of money is going to start moving around the system and somebody is going to notice and, poof, there goes another payment option.

True professional players are going to need to leave US soil if they want to continue playing online. Thailand is great this time of year, folks.

Televised poker

Other than ESPN’s WSOP coverage look for a lot of this market to dry up too. Many of the programs we all love are what is called, advertiser funded programming (AFP). That means the online poker sites are basically funding the shows. Stars or Tilt either agrees to buy most of the advertising or pays to slap their name on it.

They may still be willing to continue this model in Europe and other markets but if they can’t sign up players from the US there’s no reason to purchase the advertising or brand the show so there won’t be much activity going on here.

Legalization

This may actually accelerate legalization and regulation of online poker. Yes, I know, I know, it’s not illegal now, blah, blah, blah. Well, guess what, the DOJ just fired a warning shot over the bow saying it is illegal so unless any of these guys wants to come to the US and fight it out in court it’s basically illegal whether a law exists or not.

And that may be what wakes up some lawmakers. When they see the magnitude of the industry and truly grasp how serious of a business this is it may influence them to act more quickly in getting a bill passed.

It may also clear the way for companies like Harrah’s or MGM to push for legalized gaming in the US now that the two biggest competitors in the poker space have effectively been banned.

It could also fire up poker players. Before it was, “Meh, as long as I have a place to play I don’t really care much whether it’s legal or not.” But now many professional players are out of a job and millions of others who enjoyed the game recreationally have had all/most of their options taken away.

On the other hand, if the allegations about money laundering and bank fraud are even remotely true it could well sink online poker in the US until people forget.

Poker news/media

I think Pot Committed says it best on this one. If you work in the poker news/media space . . . you probably don’t for much longer.

The vast majority of the poker news/media is funded by affiliate revenue the news/media sites generate. No US players means a huge cut in revenues which means . . . cutbacks.

Cashing out

Stars and Tilt have plenty of money and I’m sure they don’t want to make their problems worse by also having to deal with hundreds of thousands of players who have money tied up on the sites. They don’t need the class action lawsuits, bad press in the markets they can still operate in, and overall headache. They’ll find a way to pay out US players.

Should you keep your money on these sites? Should you cash out as soon as you can? I don’t know. I probably would cash out as soon as possible if I was a US player. They’re not going to let you play there so why leave your money there?

Stock prices

I think overall this is going to be a plus for many of the publicly traded that were forced out of the US market (or were never in it). I see Party is up nearly 11% on the news and I would assume if they can follow through and get some of these customers that will be in play as Tilt and Stars lose some of their huge liquidity advantage they could perform quite well.

Regulated Markets

This might come back and bite Tilt and Stars in the European regulated markets. Some gaming regulators might not take too kindly to indicted figures at the helm of a regulated poker site. If it does become a problem you could see people stepping away and new management coming in.

And Then . . .

But all of this is sort of the short-term view. The long-term outlook is actually quite interesting. As Kim Lund says About Time! As Kim and I have both worked for companies that had to operate with one hand tied behind our backs I think there is an overall feeling amongst the non-US facing rooms that Tilt, Stars, and UB/Absolute finally have to compete on more even footing.

And that should not be taken to mean that I’m happy any of the people have been indicted. This is merely a statement about reality of online poker since Oct 2006. If Stars, Tilt, UB/Absolute, and everyone else left the US they would have had to battle it out with Party, iPoker, and the rest of the non-US facing operators. The market would be much more even and there would be more competition. And, I believe, we would already have legalized poker in the US since Stars and Tilt wouldn’t be shipping so much money to politicians to oppose bills that don’t suit their fancy. They would have jumped on board the first chance to get back in the US regardless of the terms.

Yes, I know many people will lose their jobs. I feel for those people. Believe me, as someone who derives their income from the same pool they drink from I know I’m going to take an income hit as well.

But for five long years Party, bwin, 888, iPoker, and everyone else has been playing by the rules and every quarter they report declining poker revenues because Tilt and Stars keep pouring the high profits they’re making in the US market into other markets and driving out the competition. Believe me, there’s a lot of celebrating going on in Gibraltar and Malta right now. Not that people have been indicted but that Stars and Tilt are going to have to play by the rules like everyone else.

I don’t feel great about what is going to happen but you can certainly understand why many people are pleased to see Stars and Tilt forced to operate on the same level playing ground as they’ve had to. Though I know that doesn’t bring comfort for those who will be out of work.

I know. I’ve been there. I started at Party in Sept of 2006, the week the UIGEA was passed by Congress. And I was in Hyderabad, India on a company-wide conference call when Mitch Garber announced that they were shaving hundreds of jobs. I got lucky. Many others didn’t. And the same happened at 888 and many other companies.

The same will happen again. It might be painful for individuals but I think overall it will be good for poker. Having two sites dominate the entire industry was never good for the overall poker market. Players certainly weren’t benefitting from the economies of scale.

For all of the hundreds of millions (or even billions) Stars and Tilt hardly made a single innovation (other than Rush Poker) in the five years they owned the worldwide poker market. That’s a pretty sad record for all of the money they raked in (pun intended).

My hope is that this fast tracks legalization in the US and puts some innovative companies into the mix on a playing field that allows people to have a fair shot at competing. More competition will breed innovations that will benefit the players. Sucks for Tilt, Stars, and all of the people who have come to rely on their money to employ people but, in the end, it’s probably the best thing that could happen for poker players if you’re taking the longer term view.

As Kim Lund says:

The US market did not just die. It rebooted. CTRL. ALT. DELETE. And it will reboot much faster now. The void left by this raid is too juicy for the government not to want to taste. Tomorrow. Hopefully some of the ridiculous lobbying is now silenced and things can proceed in the quickest possible manner. Dear PPA, shut the hell up.

Sometimes you need a shakeup to move forward.

Ron Fanelli – Should We Feel Sorry For Him?

Bill Rini — Tue, 27 Jul 2010 07:19:40 +0000

There’s been a story that’s been flying under the radar recently that Dr. Pauly wrote about and while I respect his views I think there is a different angle to this that many people in the poker world are ignoring.

Former poker pro, Ron Fanelli (aka MadYank), stabbed and murdered a Thai bar girl, Wanphen Pienjai, in a drunken rage. I read about it first here in the local press. As with most stories you read about foreigners in Thailand you look for the parts that don’t add up.

Well, everything added up here. He confessed to the crime, the knife was found in his home, he gave the police the shorts he wore when he killed her, etc. Sometimes foreigners do get banged up here and forced to confess to crimes they didn’t commit but this didn’t seem to be one of those times.

I don’t know why but I decided to Google around a bit for the MadYank. I found some threads on message boards popping up with news of his arrest. Many automatically assumed he had been set up by the cops looking to make an arrest. Comments like the one below were common in the message board threads:

Yeah, this looks bad especially considering how corrupt the Thai police are etc.

Others worried about the prison conditions in Thailand and if they were really as bad as they’re made out to be. Most people were in complete disbelief.

But then as the story developed and it seemed more and more certain that he actually did commit the crime of which he was accused, people started to feel sorry for him. And that’s where I sort of separated ways with them.

While I can appreciate people who feel sorry for the direction his life taken, I noticed that few if any people even bothered to say anything about the girl. I can only speculate that it’s because she was a prostitute from a third world country and not a cute, blonde who had her whole life ahead of her. It was hard to find even one person who mentioned her by name. Instead she was “the bar girl” or “a Thai hooker.” Victoria Coren‘s personal glimpse into her friendship with Fanelli was surprisingly the closest I’ve seen to anyone having any compassion for the girl he murdered.

I’m certainly not looking to lecture people but I do think it’s important to remember that Wanphen Pienjai was an actual human being. She may have chosen to become a prostitute but does that afford her a lesser place on the totem pole just because she wasn’t a washed up poker player?

Wanphen was the mother of two children that she had with a previous husband. Her daughter, named Farm, is 3 years old. Her son Iang is in the sixth grade (not sure how old but probably around 10 or 11). She was financially supporting her partially blind mother who is now charged with taking care of Wanphen’s two children without any form of financial support since Wanphen was an only child.

That much I do know for sure because it’s been in the local press. What I don’t know for sure is how she ended up working the bar scene. I can take a pretty good guess though because nearly every bar girl has some sort of variation on the same plotline.

While most tourists here see the “big” cities like Bangkok, Chiang Mai, Pattaya, and Phuket the vast majority of the country is living in third-world conditions. Most of the population live in an area in the North-East called Isaan (or Issarn). They grow rice, rubber trees, and all sorts of agricultural products for domestic consumption and export.

Wanphen comes from Phetchaboon in Issaan, a place I’ve actually visited so I’ve seen the living conditions first hand. Many people still live in wooden huts and shacks there.

Just piecing together what’s been publically available, her husband probably left her stuck with the two young children. At best, she probably had a high-school level education which in Thailand really doesn’t qualify you to do anything other than manual labor.

The girls working at my local convenience mart make about 6000 baht per month. That’s $181 USD. That’s probably the best legitimate type of salary she could hope for. And that’s working 12 hours per day, six days per week.

So faced with having two children to support as well as her partially blind mother she ventured off to one of the places that girls can actually make a decent wage. The local press says that she worked in Pattaya for a while and had only recently decided to move to Phuket.

I’m sure this was not the life she envisioned for herself as a little girl but Thailand has absolutely no safety net. There is no unemployment insurance. There is no government pension. There’s nothing. And if you get stuck raising two small children and having to care for your parent, well that’s just your bad luck.

So to put food in her kid’s mouths she left the bar with Fanelli having no idea that his life was on an out of control downward spiral.

I guess I have a hard time feeling the sympathy for Fanelli because I’ve seen loads of Fanelli’s here in Thailand. Much like Las Vegas, Thailand is intoxicating. But like any intoxicant, it can be dangerous if you let it control you.

Fanelli is where he’s at because he couldn’t control it. He made various choices in his life that put him where he’s at. And he could have just as easily made different choices and been in a different place.

Wanphen was there because of circumstances beyond her control. She didn’t choose to be born poor or have her husband stick her with supporting two kids on her own. Those are just the cards life dealt her and she tried to make the best of what she had.

And somehow fate brought their two lives together which ended in the loss of her life. So while many people who knew Fanelli from a different time in his life might feel sympathy for a life turned so wrong keep in mind his victim who was also a real person with a real life.

And in true Thai style, Wanphen’s mother only had this to say about Fanelli, “I haven’t seen the guy [Fanelli] yet, but people have called me and asked how such a handsome man could be so cruel. I am happy the police caught him, but I still feel very sad at losing my daughter. Nothing can ever bring her back.”

Anyone wishing to contribute to a scholarship program to help Wanphen’s two children can send money:

Rotary Club of Patong Beach Charity Account
Siam Commercial Bank
46/3 Chao Fah Rd
T. Taladneung, A. Muang
Phuket Thailand 83000
Account: 633-2-49363-2
SWIFT: SICOTHBK
Phone: 076-222010

Is Online Poker Really Doing Well?

Bill Rini — Wed, 16 Sep 2009 08:13:57 +0000

Nearly every week I read Poker Scout’s industry analysis and they triumph more and more growth. This month was better than last month and year over year the industry is growing at an amazing pace . . . but is it?

One of the big disadvantages we have in viewing the overall poker market is that every company that was publicly listed left the US market leaving only private companies competing for the American player base. So, we end up missing some very key data points when we are on the outside looking in. For instance, how much of the player growth is coming from the US market vs. international markets?

Nearly all the European operators are reporting very disappointing numbers in their poker products while Poker Scout claims the industry continues to expand.

PartyGaming reported overall revenues across all of their products was down 6.5%

CEO Jim Ryan attributed the drop to two key factors: the economy and the tough competition in the online poker market.

888 has seen poker revenue drop 35% in the first half of 2009. 888 attributes the decline to currency movements and the overall economic downturn.

I could keep on posting disappointing financial results from various poker sites but let’s just assume that most of the publicly traded companies where we can get a peek into their performance are reporting poor numbers. The only exception seems to be iPoker which is currently the third largest poker site and the largest poker network.

So, what exactly am I saying? Well, there are several different KPI’s (key performance indicators) that you can measure a poker room on. The one that Poker Scout and many in the industry focus on is the number of active players as counted by Poker Scout. But what does that really tell us about those players? Nothing. All of those players could be sitting at micro-limit tables folding every hand and never seeing a flop (thus no rake collected).

In fact, sites that run bad beat jackpots that have grown very large know this phenomenon well when they see their overall player numbers jump through the roof but revenues stay either flat or fall because everyone is jumping down to the lowest limit tables and playing as many tables as possible to increase their chances of winning the bad beat jackpot. Players have no incentive to play hands that won’t qualify for the bad beat jackpot so the number of raked hands (another KPI) and rake per raked hand (another KPI) falls.

Another important KPI to measure is your customer lifetime value (LTV). Your LTV, in theory, should be lower than your cost to acquire each customer (Cost of Acquisition – COA). That should make perfect sense to people. You can’t spend $100 to acquire a customer that only yields $50 in revenue. Or can you?

So here’s the part where I have my doubts about the online poker market being as healthy as sites like Poker Scout claim. It’s a well known secret within the industry that some of the companies still operating in the US are paying more to acquire European, LatAm, and Asian customers than the average LTV for a player in that market. They’re using the huge US LTV’s to finance the LTV/CoA gap in Europe and elsewhere.

Way back in the day, before anyone could ever imagine the crash of the dotcom bubble an industry colleague Rob Tercek who ran Sony’s online division told a panel “I could stand out on Hollywood Blvd and hand out hundred dollar bills and that would make me very popular. Unfortunately, it’s not much of a business model.” Of course, he was talking about all of the companies in the online entertainment space who were generating little or no revenue and were funding all of their projects with investor money. What they were doing was buying customers with little regard as to whether or not they could ever recover their costs.

Today things are a little different than they were during the dotcom glory days. I think there’s actually a strategy to overpaying for customers. More and more smaller poker rooms are finding themselves unable to compete in markets they previously owned. The US facing poker rooms are coming in and buying up all of the media and dangling juicy carrots in front of the affiliates in those markets. The smaller poker rooms who used to enjoy a comfortable position in that market are now in the position of having to pay more than the LTV of the customer or get out of the way.

That’s why you hear people like Party’s Jim Ryan constantly telling investors about the “tough competition” in the poker market as the reason for the declining revenues despite the fact that Poker Scout is reporting massive industry growth.

So how do you make money buying high and selling low? Just like Walmart. You squeeze the competition out of the market and then when you own that market you can change the value proposition to something allowing you to make a profit. In other words, it’s better to go in and shock and awe your competition into surrendering now incurring losses than to try to beat them over a longer period while turning a profit. If you can gain an insurmountable lead today the net cost of getting and maintaining that lead will be lower than fighting a protracted battle.

As an example, let’s say you are the leading poker room in Fantasy Land. You have a great brand in Fantasy Land and you’ve enjoyed several years of very minor competition. Suddenly a big US facing poker room comes to Fantasy Land and starts pumping money into all the media outlets. They fill the schedule with branded poker shows, put big splashy ads in all the relevant magazines, and offer your affiliates special deals that net them far more than you can afford to pay. They might even start raiding your best staff offering them substantial pay increases to jump ship. What are you going to do? They’re using the hundreds of millions they’re making in the US to fund the battle while you’re paying for it out of the profits you can make in only your market.

And as they eat more and more into your player base, your player numbers, and your profitability you eventually have to concede you can’t compete with them in a war of attrition. You can’t match their media spending. You can’t match their affiliate payouts.

Many rooms react to this threat by trying to hold onto their highest raking players. They invest everything into special rakeback or sponsorship deals. But this is just delaying the inevitable. Because they’re not marketing to new players and while they might be lengthening the attrition rate of some players the lack of new players will eventually catch up to them and even getting a huge rakeback deal or being sponsored won’t compensate players for the lack of fish.

Eventually the poker room concedes the market to the US facing poker site as it licks its wounds and tries to go after some other market that hasn’t caught the eye of the US poker rooms yet.

And that’s exactly the story the Poker Scout numbers tell us. The big keep getting bigger and the small get smaller. But let’s not assume that bigger means more profitable. Let’s not assume that the value of a US customer is the same as someone from Belarus. Rather than fixating over how quickly the number of players is increasing we should also look at where that growth is coming from and what value it has. That’s a far more accurate way to measure the health of the poker industry.

As I wrote in the post When is a Met Guarantee Still an Overlay? things are not always what they seem in the poker world. When you dig past the top layer of data you often come to a conclusion that is directly opposed to what the top level data told you.

Right now despite the rosy picture being painted by Poker Scout the market is tougher than it has ever been. More and more you’re going to see smaller online poker rooms give up. Even today, many are only scraping by.

You’re going to see companies like Party and 888 investing heavily in their casino and other non-poker businesses where many US facing companies have no presence. Since they can’t fight he battle head-on they’re going to pick their spots more carefully and try to avoid direct confrontations.

That might all sound a bit doom and gloomy but it’s not necessarily a bad thing. Eliminating the fly-by-night poker rooms and spammers is a good thing. It might also be good because hopefully it will inspire some innovative thinking. No longer will poker rooms be able to sit back and follow the ABC model to profits. If they want to have any hope of surviving they’re going to need to look under new rocks to find customers. They’re going to need to figure out more cost efficient ways of reaching out to players rather than relying on affiliates and cookie-cutter promotions. In other words, they’re actually going to have to fight for your business and that’s not a bad thing.

photocred to db*photography

Why Affiliates Will Always Trump Online Poker Rooms

Bill Rini — Tue, 05 May 2009 18:55:34 +0000

Before I got into the online poker industry I was always amazed at how much money poker rooms threw at affiliates. I thought they were stupid because most of the sites that were promoting them would have been happy to take a flat CPM deal if some site hadn’t been dumb enough to offer to give a flat rate referral or a lifetime cut of the MGR.

After having worked in the industry for several years I’ve come to the conclusion that online poker sites aren’t stupid. They just lack the internal framework to compete with affiliates.

Affiliates live or die by being good at what they do which is to convince people to come to their site and then to be able to direct those players to another site. In the beginning it was easy, you slapped a few ad banners on your site, created some content, and collected the cash.

But as the market became more and more competitive amongst the affiliates they had to get better and better at performing their job. That involved driving larger amounts of traffic to their sites and improving their conversion rates.

Obviously different affiliates have taken different paths on driving the traffic to their sites and most have begun investing in their own conversions via freerolls, rake races, and other methods designed to provide a unique and compelling reason for a player to click on that link and download a piece of poker software.

The one thing most successful affiliates have in common is that they’re better at their job than the poker rooms are. You would think that new signups being their lifeblood and the fact that they are grossly better funded than the affiliates that it wouldn’t be difficult for them to be better and more efficient than their affiliates but generally that isn’t the case.

The online poker sites have more or less turned into branding machines. Instead of concentrating on luring players in they blast out their branding message via as many media outlets as they can afford and then hope enough people will type in their URL into their browser or at least know the brand well enough to click on the affiliate banner on a poker affiliate site they may already be visiting.

I think the best way to illustrate this point is to cite just a few mistakes that online poker sites have made:

1. Not buying out 2+2 in the early days of online poker. Maybe someone approached MM and he didn’t want to sell or maybe nobody even asked him. Whatever the case 2+2 has blossomed into one of the most trafficked poker sites on the internet and even though it could use a big overhaul up in terms of monetizing traffic one can’t argue with the numbers.

2. Not buying out PokerNews or creating a well-funded competitor. I’ve heard rumors of PN being on or not on the auction block a few times over the years but they remain independent and bigger than ever which means anybody who balked at their price probably walked away from a bargain.

3. Not creating a poker coaching site. Granted, Full Tilt now has their poker academy but that was only after PokerStrategy.com became the most trafficked informational poker website on the internet.

And not only did the online poker sites not do any of the above they helped create these powerhouses. Not just from affiliate revenue but if you’re a decent sized affiliate and call up any major poker room and tell them you’ll throw a few hundred new signups their way if they host a $5,000 freeroll that’s only open to your players the online poker site can’t set up the tournament fast enough. In essence, the online poker sites picked up part of the marketing costs of acquiring the players they were paying the affiliates to acquire.

It’s not that the people at online poker sites are stupid. In fact, I’ve met some absolutely brilliant people in the industry. It’s that they’re always two steps behind.

Since Otis is busting my chops about Facebook and Twitter at the moment, let’s take social networking as an example.

Someone will create a successful poker related business model using Twitter. I’m sure of it. I’m equally sure that it won’t be an online poker room.

The reason why is that there will be some people within the online poker sites who are all over Twitter. They’ll be Twittering fools. And they’ll mention it to this or that executive who may or may not have even heard of Twitter and perhaps, just maybe, they’ll throw some token resource at it. Maybe someone will be authorized to tweet an hour or two a day. As a result the effort will be half-assed and so will the results which leads the poker room to believe that it’s a wasted effort.

On the other hand affiliates see Twitter as a possible source of driving more players and for them that means more possible sources of revenue. They’ll put more resources into than the online poker site and experiment around with models until they find something that works.

By the time Twitter starts becoming a big enough buzz word in the industry that CEO’s and other top level executives hear about it and start asking why nobody is doing anything about Twitter the affiliates will already dominate the space and the online poker rooms will do one or both of the following things:

1. Pay the affiliates a lot of money for the players that they’re pulling in from Twitter.

2. Attempt to start their own Twitter marketing channel and either do what the affiliates are currently doing but less effectively or they’ll start from scratch and repeat all of the mistakes the affiliates made long ago and have already learned from.

Again, I don’t say that because I think that the people who run online poker sites are stupid but my predictions are based on what how I’ve witnessed blogging, Facebook, and just about every other online phenomenon develop.

The problem is that most online poker sites throw their best and brightest at staying ahead of the competition on the known playing field. The unknown, or untested playing fields are mostly ignored.

Right now, my guesstimate would be that 90% of the online poker rooms have less than one full-time person devoted to social media. Many sites might have a Facebook page but it probably only gets a few hours of month devoted to it. Many sites have blogs these days but how many are nothing more than marketing channels where all they blog about is promotions, their own events, and bonuses? Many poker site blogs don’t even allow comments. How social is that?

Almost every time I’ve heard someone on the operator side of the industry discuss something like blogs, Facebook, or similar technologies I’ve heard the following phrase (or something like it) spoken, “We should do it because it would be good for SEO.”

Affiliates don’t start social media or blogging because it’s good for SEO. They do it because they know they can drive traffic with it. In order to drive traffic they need to create something compelling, sticky, and of value for the readers. Since they approach the challenge from a completely different objective they usually get radically different results. And take a guess who’s going to get better results; Let’s do it for the SEO or How can I make money off of this?

I wouldn’t even lay the blame at the feet of the poker rooms though. The industry is so new and evolving so rapidly that quality people are rare. There simply aren’t enough bright, creative, and business minded people to go around the industry. So if given the choice of throwing your best and brightest at untested technologies with unknown potential or throwing them at keeping you in the fight with your competition the ROI says to put them on keeping up with the competition.

On the other hand, successful affiliates operations are often are born out of some very bright, creative, and fanatical person putting all of his or her energies into untested technologies and making an idea work. They live, breath, sleep, and eat their idea until one day they wake up and they’re clocking six or seven figure checks every month (or they go broke).

A lot of this is hardwired into the culture of the poker rooms. Most of the poker passion in a company is devoted to the retention side of the business. Poker players understand poker players so they are put into roles like poker room management, retention promotions, VIP, CS, etc.

On the other hand, the acquisition side of the business is run by traditional marketing people who may or may not have any particular passion for the game of poker. That’s not to ding marketing people but they’re expertise is buying media, organizing campaigns, and branding. They don’t necessarily have or have to have a passion for the game.

In fact, Raphael Arnold, CEO of Netrefer said something very similar, “While most operators were recruiting general marketers, spending money and hoping for the best; the affiliate, spending their own money, were learning to market in creative and frugal ways, becoming an important part of the industry’s growth,” which is notable not only for it’s truth but for the fact that I think he broke my own record for run-on sentence of the year.

On the acquisition side it’s easier for the marketing guys to partner with affiliates who do understand the customers and who are willing to develop innovative business models than it is for them to come up with these ideas on their own. For them it involves a lot less risk if they simply buy the customers from the affiliates. Besides, most of them are coming from other industries where they are used to spending to get. You buy television. You buy print. You buy CPA. You buy CPC. Actually creating organic traffic or viral content is not really the specialty of most marketing people.

It’s very similar to something I keep hearing over and over again when I talk to poker room operators. They’re all complaining that PokerStars and Full Tilt are dumping so much money into this or that market that they’re being pushed out of markets where they used to dominate. And my answer is always the same “You better come up with a strategy to counter that because their money supply is endless and they’re going to keep spending until they’ve completely choked you out of the market.”

And the funny part is that let’s say that Full Tilt comes into Imagistan and starts buying up all the media there. As an affiliate for Full Tilt your job would, on paper, get more difficult because Full Tilt is recruiting players directly and cutting you out of the chain. Sure building the brand helps you but once people know who Full Tilt is they can type in fulltiltpoker.com as easily as they can click on a link on your site.

But the affiliates are thriving in these new markets. The more money the poker rooms spend the more money the affiliates make because the affiliates leverage the bigger trend in poker awareness instead of going for the easy kill conversions. Affiliates figure out how to get long-tail search results and push themselves up the SERPs so as more and more players get into poker and start searching for poker related stuff they get out there where the poker rooms aren’t.

At one of the SEO panels I attended this week one of the roundtable members, Bob Raines spoke about how Everest Poker targeted a German celebrity who hosted some poker thing in Germany and the how well that did for them. From what Bob said Everest had no relationship with this celebrity but they recognized that people would put his name and poker together in searches and they captured a lot of traffic.

Perhaps Everest and Bob Raines are an exception to the rule here but I can tell you that most poker rooms marketing departments wouldn’t even think about trying to monetize a celebrity who wasn’t signed to represent them.

I just tested this out but I did a search on “boris becker poker.” Boris Becker is obviously a well-known German tennis star but he’s also a poker player and PokerStars signed him as a representative. Although the PokerStars Blog comes up as the first result and PokerStars.tv comes in at fifth PokerStars doesn’t own another result in the top ten for that phrase. Pokerati ranks higher than PokerStars.tv!

A motivated affiliate or a poker team with an aggressive acquisitions strategy would try to rank all over the top ten for that. Who cares if he’s affiliated with PokerStars if you can slide in there and steal their thunder by ranking #1 or #2 for that term and forcing those searchers to your poker room instead of PokerStars? Let them pay for sponsorships while you feast off of their SEO laziness. What kind of coup would it be for Full Tilt to rank #1 or #2 for “boris becker poker” when PokerStars was paying to create the keyword phrase?

Most poker rooms don’t have a SEO strategy outside of the ultra-competitive keywords. They all slug it out and spend ridiculous sums trying to rank for terms like “online poker” while the affiliates are out there making millions off of ranking for keyword phrases like “best party bonus.”

I just did a search on “best party bonus” and PartyPoker isn’t even in the top 10 results. And that was the first phrase that I snapped off when I tried to come up with a phrase that people would actually search for but most poker rooms would never optimize for.

I could go on for pages listing similar examples but the point is that in the online poker space affiliates do it better and faster than the online poker sites can. Perhaps that will change at some point but at the moment most rooms are too focused on other parts of their business.

The bottom line is that in order for online poker rooms to remove affiliates from the value chain they will need to do it better than affiliates do. They’ll need to buy out the sites that are already doing it better than they are and hire brilliant, cutting-edge, people to run their online campaigns.

But most won’t do that. Maybe the Full Tilt’s and PokerStars have that kind of money but your average poker room is going to keep paying out affiliates to do what it should be doing because it’s economically a sounder proposition.

Eventually though that will become a problem; What’s that saying about never picking a fight with someone who buys ink by the barrel? In today’s world you should never compete with a company that buys pixels by the terabyte.

The whole value model will need to reevaluated. When non-public companies shift their focus from market share to profitability there will be a lot of affiliates who find themselves in the crosshairs of online poker rooms.

That doesn’t necessarily mean the poker rooms will be successful. I could buy 2+2 and drive it into the ground. Many of these affiliate sites need an independent management structure that allows them to be out there on the cutting edge. But fi they start buying the right properties and getting the right management in it will be very difficult to compete for all but the biggest affiliates.

Like I said from the beginning, poker rooms aren’t stupid. They just have their attention focused elsewhere at the moment.

Photocred goes to extranoise

The Online Poker Industry’s Love Hate Relationship With Rakeback

Bill Rini — Mon, 20 Apr 2009 12:01:31 +0000

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There’s probably no single topic that divides the online poker industry more than rakeback [what is rakeback?]. Seriously, in many companies rakeback is a dirty word. At one company I know it’s jokingly referred to as “The Unmentionable” by the poker staff because to even say the word rakeback generates a negative Pavlovian response within the organization.

Other sites publicly denounce rakeback but then offer promotions and/or bonuses that essentially amount to rakeback. They might call it value, or commission, or fee but it’s still rewarding players for generating rake.

And lastly you have the rooms that use rakeback aggressively to acquire and retain players. For them it’s a tool they use in order to compete against better-funded poker rooms that can buy up all the media in a market and shut them out of traditional marketing channels.

The affiliates are also in a similar battle over rakeback. Traditional affiliates detest rakeback. They spend a lot of money creating valuable content that they might not otherwise be able to produce if they had to give the lion’s share of their affiliate fees back to the players.

On the other end of the spectrum you have the rakeback affiliates who don’t mind working on slim margins because they can still make money on the sheer volume of players. Also most rakeback affiliates don’t create expensive content (tournament coverage, actual journalists, etc) so they operate with far less overhead than the traditional affiliates.

Who are we forgetting here? Oh yes, the players. The players are a little less divided. Either they know about rakeback and love it or they have no idea what it is and probably don’t even care.

Can’t we all just get along?

In reality, almost everyone has a valid argument. The problem is that the online poker industry hasn’t really grasped the fact that one size doesn’t fit all.

A rakeback affiliate and a traditional affiliate provide two completely different types of functions. A large poker news site is likely to have tons of content that rates highly in search engines and will attract newer players when they search for certain keywords or follow a link sent to them by a friend. Yes, hardcore poker players also use their content but most don’t click on the affiliate links.

But the rakeback affiliate is also providing a function. The rakeback affiliate is catering to a more sophisticated poker player. The rakeback affiliate aggregates valuable (higher raking) players and provides them with customer support, specialized promotions (rake races, etc), and serves as a single interface for the poker room.

So on one side you have the traditional affiliate who can send a large volume of players but the traditional affiliate normally doesn’t even know who they are nor do they tend to have any sort of ongoing relationship with them. On the other side you have the rakeback affiliate who sends fewer players but knows all of the players they send (to the degree that they have their contact info and pay them every month) and maintain an ongoing relationship with them.

Unfortunately, most poker rooms offer only one model of compensation. Send us players and we give you a cut of the rake.

And the poker rooms are stuck in the middle. They don’t want to anger their traditional affiliates by condoning rakeback but they don’t want to lose their best customers to competitors that do allow it.

And because there is no simple answer, poker rooms either take a hostile stance, shamelessly offer rakeback to anybody who asks, or try a middle ground that ends up being so convoluted that even David Sklansky can’t work out the math of how their system works.

So what’s the answer?

I’m not sure I have an answer. I have some thoughts but not necessarily an answer that will work across the board. It’s a difficult problem because you have to raise the switching cost for the players while still keeping the affiliates happy.

One of the other major problems comes out of the fact that most of the existing affiliate models originated from a different era and are outdated in today’s current landscape. The affiliate model was devised at a time when the US was essentially the only market, rakeback was unheard of, the poker player community was rather immature and unorganized, and most sites didn’t have the capital to conduct large media campaigns.

All of those parameters have changed since the inception of affiliate programs but the poker rooms have yet to evolve. If anything they find themselves being in the uncomfortable position of providing a commodity service.

With online poker rooms receiving anywhere from 20% – 50% of their new sign-ups from affiliates and the old 80/20 rule whereby a small percentage of affiliates send the majority of the traffic, the online poker sites really don’t have the leverage to change things on their own.

But by the same token, the traditional affiliates are going to have to come to grips with the fact that a player who they sent to XYZ Poker two years ago when he was a newbie to poker who is now 18 tabling small stakes games and raking $15,000 a month wants some of that rake back. If the affiliate doesn’t cut him a rakeback deal then he’ll quit playing on the site and go to one where a rakeback affiliate will give him a deal. So they can either have 5% of $15,000 or 100% of $0.

To be fair, many affiliates have seen the writing on the wall and are making just such a change to their business model. Many of the coaching sites and educational sites require that you link up your account with them with your account on the poker room so they can track your progress and pay you out bonuses and such. Some of those sites have either already implemented or have discussed offering incremental rakeback whereby players start off with zero rakeback and either as a function of time or MGR are offered a higher and higher percentage.

That does seem to be the model that makes the most sense as both an affiliate and the poker room spend most of their money trying to acquire players. Once the player is in the door the longer they remain a customer the more profitable they become.

So where does that leave blogs, news sites, and everybody else who doesn’t have a one on one relationship with their players?

Well, as I mentioned, the 80/20 (probably more like 90/10 in most cases) rule is in effect when it comes to affiliates. The overwhelming majority of affiliates simply don’t send enough players. From a business perspective it would make sense if they ended MGR deals for any affiliate not generating X number of signups per month and then putting in some stringent rules that took any incentives out of trying to scam the room on the CPA deals.

As for the upper 10% or 20%, I think the poker rooms should just buy them out. I know that sounds crazy but over the long run it would likely be cheaper than paying them out as affiliates. I mean, listen, I see a lot of these affiliates around Gibraltar, Malta, and at conferences and many of them are doing quite well. If there’s that much money in the value chain then as long as you can buy the company for a reasonable price then it’s a good investment.

Another alternative would be for the poker rooms to force a rakeback scheme on the traditional affiliates either by policy or via offering so many bonuses that went against MGR that the net effect was the same for the player and the affiliate.

I know some larger affiliates who read that might gasp a bit but as rakeback becomes more widespread within the poker world the players are going to force their hand eventually anyway. When player attrition rates (churn) start increasing most affiliates are going to have to make a choice between making up for that by pumping more new customers through the door or conceding that they have to split some of the profits with the players.

Well, technically, there’s another option which is for the affiliates to hit the poker rooms up for a larger percentage to compensate them for the higher churn rates but sooner or later they’ll reach a point where the poker rooms can’t pay them a large enough percentage to compensate them for the churn losses. Plus there’s the fact that the poker room will likely take note of the lifetime value of the players being sent and put their own throttle on how much they are willing to pay for similar caliber players.

Like I said earlier, there aren’t any easy answers. The industry is maturing and like it or not rakeback will likely be here with us for awhile. Love it or hate it players are going to increasingly demand rakeback. It should be interesting to see how the industry responds.

photocred to adam*b

Five Ways to Improve Your Poker and Crush the Competition

Bill Rini — Mon, 23 Mar 2009 09:44:19 +0000

A lot of people ask me what the best way to improve their poker game is and for many of them it would be if they quit playing poker. But there’s another group of people who may be decent poker players but they feel like they’re stagnating. They don’t feel like they’re improving.

This list is less about turning you from a losing player into a winning one and more about putting new life into an already decent game.

If you’re still learning the game or you’re a losing player there’s no harm in reading this article (I tested it on small animals first) as you just might find some of your leaks buried in here.

1. Identify Your Problem Situations

Most players I know have situations where they perform poorly. For some it may be what to do when they miss the board after raising with AKo out of position. Some get stuck when someone wakes up and bets into them after they’ve been doing all the betting and raising. Whatever it is, you likely have at least ten different scenarios where you find yourself making tough decisions.

So let’s make those decisions less difficult by doing the thinking ahead of time.

Take your ten problem scenarios and rank them in order of frequency. If you have any on your list that happen once in a jillion hands then replace them with more common scenarios.

Now that you have your list of ten sticky areas take just one and examine it from every angle. For instance, if we’re talking about missing the board with AKo start running through possible scenarios. Is it a family pot? Short handed? Heads up? What kind of opponents are you up against? Is the board coordinated or is it ragged? Are you in position or out of position? If you bet and get raised what sort of players will you lay the hand down against? When will you call? When will you re-raise? What has been your table image up to this point? Have you been caught continuation betting with nothing recently?

This isn’t easy. You should give each scenario at least a day’s worth of thought. But take two, three, or even seven days to really look at the situation from every possible angle.

When you think you’ve covered every possible angle that could come up jot down the situations where you feel the least confident that you’ve identified the correct play and discuss those situations with respected friends or post them on a message board like 2+2 or P5′s. Get some fresh input and see if your thoughts hold up. Don’t be afraid to defend your decisions just because another player tells you that you’re wrong. Defending a position often opens up new lines of thought. On the other hand don’t be stubborn if they appear to be right. That holds especially true when the margin between one move and another is relatively slim and both of you could be correct.

Then once you’ve done that for scenario one move on to scenario two and repeat the process until you’ve ironed out the bugs in all of your ten toughest situations. When you return to the tables your decisions will come more naturally and you’ll be more confident that you’re making the right play.

2. Help Someone With Their Game

Regardless of the subject matter I’ve always learned more about the topic when I had to teach someone about it. When someone asks why you raised with AJo the last hand and called with it this hand you have to be able to explain to them why the two situations were different. Explaining means you actually understand why you did it! It forces you to get out of your auto-game and to really be aware of how you’re playing.

The best way to put your teaching skills to the test is to teach from example. For online players I would suggest that you pull some hand histories as examples for your student. Yes, you will be surprised at how many hands there are where you have no logical explanation for your actions in a particular hand. That’s a good thing. It gives you something to think about. It reinforces the fact that most of us play the game too much on auto-pilot when we should be thinking.

If you don’t have access to willing student then go on your favorite message board and try to help people with their game. When people post hand histories and ask for feedback be one of those guys who volunteers to give a critique. Again, watch how many times you find yourself saying “Well, I probably would have played this the same way but I know it’s wrong.” The stinging feedback of your analysis from others on the message board will also be a good motivator to really put some time and effort into coming up with the correct moves.

3. Quit Reaching

Both out of peer pressure and pride many of us reach beyond where we should in terms of poker stakes. A good percentage of the highest raking (and winning) players in online poker play limits from $1/$2 – $5/$10. Granted some of that is NL but the point is that you don’t have to play Phil Ivey levels ($500/$1000) to be a good poker player. If you can make your nut playing $2/$4 on 18 tables for 8 hours a day you are far ahead of the guy losing his ass or breaking even at $30/$60 (limit) hold’em.

Quit trying to be a poker hero and concentrate on where you can beat the game. I know that when you tell people that you’re a good poker player and you have to admit that you’re playing low-limit poker it doesn’t sound glamorous but would you rather be glamorous asking people to stake you or playing low limits and sitting on a pile of cash?

That’s not to say you shouldn’t move up or that only low limit players are winners but many players would be better off playing for profits rather than to impress. I see this all the time when someone wins a lot of money and others in the poker world scoff at them for continuing to play low limits. In fact, I remember Chris Moneymaker being made fun of on 2+2 several years ago for still playing $2/$4.

There are tons of poker players who had a flash in the pan and couldn’t move back down to their skill level who are either currently or chronically broke.

Like I said, I’m not here to tell you not to move up in limits when you can. But sometimes your win rate at a higher limit doesn’t justify the move up and you need to do the math to figure out when that is the case.

Instead of worry about how many BB/100 or buy-ins you have in your bankroll you should be focused on your win rate. If you’re earning $12 per hour at $3/$6 (2BB/100) and $10 at $5/$10 (1BB/100) then the $3/$6 should be where you’re playing. Moving up to $5/$10 so you can roam with the big dogs only is of value if bragging rights are more important to you than money.

Keep sharpening your game and take shots. And if you can never beat the $5/$10 at an earn rate that is higher than your $3/$6 earn rate it doesn’t matter. If you are truly looking to maximize value then who cares about what everyone else thinks of you? Truth be told, over 90% of the people who play this game lose money. If you’re pulling down a profit then you’re already in an elite class. Would you rather be earning $4K a month playing $3/$6 or losing $10,000 a session playing $500/$1000?

4. The Murder’s Row Rule

This is a rule that Hank came up with in the infamous Murder’s Row games when we were all back in LA. In addition to getting your standard chips you would also receive a certain number of non-denominational chips. I think we used 3 or 5 chips.

The idea is that over the course of the evening you can use those chips to make your opponent show his cards AND explain why he played the hand the way that he did. Obviously this was all done at the completion of the hand.

This accomplished two things. The first was it allowed everyone sitting around the table to learn from each other. But the second, and I suspect unintended consequence, was that it made you think a little harder about the game. If you know that your opponent can make you table your retched cards after the hand and you have to explain to nine other experienced players why you played the hand as you did, you tend to play a little better.

And lest one think that the bad players were the main beneficiaries, even newer players can be good at picking up on tells or noticing patterns. The first time you hear “I knew you were on a draw because you always re-check your cards when you’re drawing,” is certainly an eye-opener even for experienced players.

5. Write About Poker

I started my blogging about poker because it helped me analyze my game. Putting it on the internet made me be more honest about my mistakes than I might have been had I been able to rationalize them privately.

I’m not telling anyone that they need to set up a blog. God knows there are enough crappy poker blogs out there today. What I’m saying is that you should spend some time getting the thoughts out of your head into written form some place. Write it on a blog. Write it in your own personal journal. Write it in a MS Word doc that only you review. Whatever method you choose, get in the habit of writing about poker.

Our minds are wondrous things. The more times you fire off certain chemical reactions in your brain the better your brain learns information. That’s why taking notes is such a good learning tool in school. Not only are you exposed to an auditory stimuli but when you write down a completely different set of functions kick in to reinforce the auditory input. Your mind fires off multiple types of functions which gives you different ways to remember and access the information.

Likewise, writing about poker exercises a different set of skills than does just playing the game.

Playing the game is very much about being in the moment. You don’t have time to go googling around for information or to discuss the hand with a friend. You have that time when you write about poker. You can take quick notes and then expand on them later when you have the time to perform some analysis.

Do what many of us early poker bloggers did when we first started out and use all of that research you’ve done to write a blog post to educate other people on that particular concept.

Conclusion

After we attain a certain level in poker where we can generally beat the game it often becomes difficult for players to advance to the next level. Their plays become too routine or they rely on rigid rules that they learned as beginners. The only problem is that as more and more poker knowledge becomes available to all players your opponents make less mistakes and your win rate begins to decline. Unless you are willing to make poker learning a continuous process that goes beyond what others can find in books you’re destined to be nothing more than a break-even player.
photocred goes to Idol

Crazy Rigtards

Bill Rini — Sat, 14 Mar 2009 12:08:14 +0000

Because of my Online Poker is Rigged parody post as well as the many posts I’ve done on why online poker is not rigged I get a lot of heat from rigtards. Rigtard is a name I ran across on 2+2 that is used to describe the constant stream of ZOMG ONLINE POKER IZ SO RIGGEDZ 1!1!1! posts on the message boards. I like it. It really is a fitting name. No matter how many times I say don’t bother contacting me unless you have some evidence some rigtard always leaves a comment or sends me an email using my contact page to tell me that even though he doesn’t have any actual evidence he’s convinced online poker is rigged.

Most of the time I just delete them from my inbox and go on with my life. But this guy has earned a special place in my heart. I don’t know if he just hit me on the right day in the right mood but for whatever reason I decided to engage this guy in some debate.

I was posting about my experiences with this guy on Twitter and a few people asked that I share the email conversation. So here it is for your enjoyment.

Here was one of his original emails to me. He actually emailed me multiple times using my contact form before my initial response so Gmail put them in separate threads. I’m just including this thread as it is the one that has the core of our debate.

Just read your blog???? well since you work for a company who designs this
RIGGED software i offer you the ultimate test. 6 player game you get casino
hand delt 6 player cards i get online 6 player delt cards we both take top 2
hands and see who has the best . Â£1,000 a deal 100 deals. Again
you get casino delt hands i have online computer delt cards,,. If site is not
enhanced all should be about level but as a semi pro i know you will lose 2/1
plus. Should you wish to take up this offer im sure the press would be very
interested
V.

I don’t know. Did you just read my blog? Why is that a question? Obviously someone doesn’t know what punctuation comes at the end of a statement and which to use at the end of a question.

My response:

Well, nice to see you know very little about variance. Could explain why you think the game is rigged.

I would take your challenge but only for a substantially larger number of hands. 50,000 – 100,000 would be a large enough hand sample size to determine if skewed results were a result of variance or rigged decks.

You do understand why 100 deals is ridiculous don’t you? Even if we were to flip coins, 100 flips could produce massively skewed results.

And he responded:

Bill lets go name one site that rests for MATHMATICAL PROBABILITY thet test for everything but.If you dont think sites are enhanced lets get some press and do the bet. I play semi pro 30-40 hours a week im no green horn. If you have any data at all that shows where MATHMATICAL PROBABILITY IS TESTED I WILL VIEW IT WITH INTEREST.
V.

Now, one of the things you’ll quickly notice is that it’s very difficult to decipher what the hell this guy is talking about. Even if you give him the benefit of the doubt and try to translate it still doesn’t make sense. For instance:

Bill lets go name one site that rests for MATHMATICAL PROBABILITY thet test for everything

So let’s assume it’s simply typos and what he meant to say was “Bill, let’s go name one site that tests for mathematical probability that tests for everything.” WTF does that even mean? It looks like he started off the sentence with one thought in mind and then went off in another direction but didn’t bother to edit himself so as to make any sense. “Bill, let’s go name one site . . . “ Let’s go? What?!? And then he wants me to name one site that tests for mathematical probability that tests for everything. What in the hell does that mean?

And why, why, why do people always have to throw their level of playing experience into the debate? Does it matter?

I responded:

No, not a semi-pro . . . hahaha

If you want data, go look in the 2+2 forums where guys like you have been getting beat up by other semi and actual pro players for making baseless claims for well over a decade. I really don’t have time to educate you on a personal level.

I’m sure they would love for one more ZOMG!!! ONLINE POKER IS THE RIGGEDZ post.

He is obviously fixated on this challenge he’s posed to me. I was actually thinking of taking him up on it too. But with different terms. Fifty thousand hands dealt live and fifty thousand online hands. If the online hands are within expected ranges then he pays me 100,000 GBP. If not, I’ll give him 100,000 GBP.

Ok i will see what ul press interest we can raise and you fully understand that we get the online hands and you get the live delt hands.
How can you honestly say your programs reflect mathmatical probability,As i said show me tests on this. online flops are action flops in most cases probability of theses flops and connecting hands between 2 players defies all mathmatics but i do give you the fact we need more deals.

V

Before I could respond he fired off another message. This will become a pattern as you’ll see later. He’s not really interested in a response. He just likes shouting into the wind.

Bill you presume I lose online lol im a winner but just because i win doesnt mean I have to say site is honest as its not its enhanced rigged defies MATHMATICAL PROBABILITY. WHERE ARE THESE TESTS OF MATHMATICAL PROBABILITY?? V

This time I get a chance to respond:

You didn’t read much of what I wrote on the subject did you?

You do realize that the poker room would make far more money dealing dead flops than action flops. Do the math. As max rake is usually capped, the poker room’s advantage is in dealing more hands, not bigger pots.

He counters:

I take it that you have never been a gambler?? I used to gamble lots and turned this into an art form poker. I dont gamble and havnt for years but i do fully understand the gambler. Your comments are incorrect as action flops get the gambler buzzing leading to over betting leading to increased calls from rocks. This all adds up to you guessed it INCREASED RAKE. V

I’m really not sure what the hell he intends to accomplish by telling me he’s a gambler. He somehow turned gambling into an art form (WTF does that mean?) but he hasn’t gambled for years. The two ways I can take that is that either he was a good gambler or he realized how futile it is and gave it up. So if he was good at gambling (is there such a thing?) why quit? And if he was some degenerate then why does he think his opinion holds any weight?

My response:

Where did I say that you lose online? Geez, no wonder you’re such a paranoid lunatic.

I’m laughing at you because you think I might be impressed by your claims of being a semi-pro. I’m laughing at you because if you went on 2+2 which is more or less a forum full of players from beginners all the way up to WSOP winners they would verbally gang rape you for the complete idiocy of your statements.

You’re just another random guy from the internet who claims online poker is rigged with no actual data. You want the world to stop spinning to listen to your completely baseless claims.

If you want the challenge I proposed and you actually have £100,000 to wager go onto 2+2 you’ll get plenty of takers.

Now you have to pop back up to the response where he said that online poker is rigged for action flops. I know it’s confusing because there are two different threads of discussion just in this thread. He was also going off in another thread which is why I didn’t include that one as this one is confusing enough by itself.

Here I am responding to the rigged action flops accusation.

As they say at university: Nice theory, now show your work.

Please show the math on how action flops lead to more rake. If you comb around the site, I’ve already done the math to prove you wrong.

He responds:

Bill please send any test data that you have that proves mathmatical probability is reflected in your program i will read and study top to bottom. Hard cold facts always interest me but please stick to tests that prove mathmatical probability. I will leave you with a cash game fact from last week, My cards were running bad very bad so i made it a point to play faily tight. 7 hours and 20 minutes later it was 8am and i hadnt played a single hand. 78 suited was enough to play but as i said over 7 hours and no play. Onlin lol i decide to play tight though there are 3 to 4 times as many hands delt i have never managed to not bet or call a hand outside of 15 minutes, Why is this im more lucky online lol no its enhanced. V

How the hell do you play poker for 7 hours and not have a playable hand? Is it even possible? Assuming 30 hands an hour, multiplied by seven hours, that’s 210+ hands. The best hand he’s dealt out of 210 hands is 78s? Something tells me this joker has some very selective memory and a wild imagination.

Again, he responds to a previous email which I believe is the one where I tell him to go ahead and issue his challenge on 2+2

wow your full of yourself lets stick to facts shall we?????? facts theses tests that prove online sites are mathamaticaly random where are they ??? I ask for data you send me 2+2 your full of words but please provide these test results and if there are none to shut down all the bad blog add this test?? V

I’m sending this to the NSA, CIA, and FBI to see if the can decipher this code. It appears to be in English but it’s obviously some sort of coded message. Maybe this guy is planning a terrorist attack. The fact that every sentence, whether statement or question, ends in a question mark is the telltale sign.

Now, if you’re keeping score. I still have yet to respond. But that doesn’t stop him from sending yet another email.

Wow how many people answering me You claim is honest no action flops well show me the tesyts you are the guys who say you test for mathamatical probability i will have uni test if you wana go public b4 the test. V

How many? I have no idea. How many voices do you hear in your head?

Finally I respond:

Are you serious? You realize you disprove your own argument, don’t you? If you went 7 hours and 20 minutes without getting a hand in the top 20% of all starting hands do the freakin’ math!!!! The live game is the one that seems statistically abnormal.

You might try reading this thread. It took me so much work to find. I went to 2+2 and typed “rigged” in the search box.

http://forumserver.twoplustwo.com/28/internet-poker/random-distribution-analysis-429714/

Don’t come back until you’ve read the entire thread and all of the articles it links to. When you are done, you can come an apologize.

At this point I decide I should start having fun with him. I mean, if you can’t make fun of the mentally unstable who can you make fun of?

And I’m serious about not coming back until you’ve read everything. I will be giving you a test and if you can’t pass the test then I don’t answer any more of your emails. Bad dog.

He responds:

easy meat ???????????????????????// did you not say that we need a six figure test of hands . My point was an odd fact that from time to time comes up in live play (as it should online if not rigged for action) I suggest that you stay away from live poker i would eat you alive you tilt so easy and cant recall your own actions from just a few minutes ago. but back to these tests on mathmatical probability please email them V

WTF is easy meat and why does it deserve 23 question marks and two slashes?

Another email from him:

Well done we cut to the chase and you run. Please forward all tests that you say you do to reflecttrue probability. V

I respond:

I sent you a link to the tests. Several people link to publicly available tests. If you’re either too lazy or too stupid to read the thread then that’s on you and we’re done talking.

For those who can’t be bothered with the 2+2 thread there is a link to some studies done by a player who analyzed a large HH database and concluded that you get dealt specific hands roughly as expected and that hands complete (pocket pairs make sets, flushes and straights complete, etc) basically as often as they should.

He responds:

Well your full of bull read what i write SEND TEST RESULTS not gossip and here say na. Random was used bad bad, Do you ynderstand the differance between random and TOTALY RANDOM???? DOUBT IT YOUR TO FAR UP YOUR OWN A FIVE FIVE. Listen you say you work on this software and its TOTALY RANDOM (refkects true probability) Well send me the test results and take those blinkers off and see the light????

ONLINE POKER IS BENT DISHONEST BECAUSE OF PEOPLE LIKE YOU. SEND ME THE TEST RESULTS THAT TEST MATHMATICAL PROBABILITY NOT SOMEONES SHALLOW OPION.

Now, I’m pretty sure I have him on tilt which is funny because just a few emails ago he was claiming he had me tilted.

One funny/interesting aside; he ends his fist sentence saying “na” which Thais use at the end of a lot of sentences to mean “ok?”. So in Thai someone might say, “Take care of yourself na.”

I don’t know if it is one of his many nonsensical random words thrown in or if he really meant “na.” It is fitting there. Send test results and not gossip, na?

Also, why say A Five Five? Why not just type A55 if you mean ass?

And he doesn’t want to be sent shallow opinions but his entire argument here is . . . his shallow opinion. He’s not even good enough to Google around for data. Plenty of it exists and you can refute the data or question the testing methodology but it’s completely pointless to run up to someone and demand that they prove that online poker isn’t rigged. Why should they? What’s in it for them? If it’s rigged, quit playing. I don’t give a damn. Why is it my responsibility?

There are a lot of games that are rigged. Three Card Monte. Anything involving wallnut shells and peas. That game where you have to knock the cans off the stand at the carnival. And you know what? I don’t play those games! I don’t go around looking for people to prove to me that they’re not rigged. I simply don’t play them. Why do rigtards insist on playing a game they claim is rigged? What does that say about their level of intelligence?

If you play online poker and you think it’s rigged you’re an IDIOT!! Going around and telling people that you think it’s rigged but you continue to play is like tattooing “I’m retarded” on your forehead.

So at this point, I’m more or less done with him. He didn’t really read the thread, has no real argument, and is becoming increasingly unstable. So I decide to throw him over the edge by ignoring him.

I’m sorry. You failed. Our conversation is over.

What follows are a series of emails he’s sent. The above is the last email he’s received from me. At this point he’s talking into the wind. And remember, these are over the course of several days so he sends an email, stews, and then the next day he fires off another.

Yes you go run off come the test you know its rigged you know theres no test for mathmatical probability as this would expose the sham. The site you sent me to tests randomness lol lol lol lol lets discuss the goal posts programmed into this randomness. It is now time for me to where my shirt at the next poker torn i play exposeing this con. Look out for my genuine web site in the near feature. I hope your lack of knowledge on rigged poker didnt embarress you to much. NOTE TEST MATHMATICAL PROBABILITY NOT randomness there a mile apart in meaning. V

I would love to see someone walk into a casino and sit down with a “I’m a rigtard. I believe online poker is rigged. I have no evidence but I’m a semi-pro player so I know.” t-shirt.

Another:

Anothr guy given limited skills takes on the enlightened and comes unstuck????? try telling tales to 5 year olds GL bud

Another:

Well no test results i see You state you work for software company and yet you have no tests of math probability, that stinks. Did enjoy 2+2 i find im not alone and many players have discoverd your site are indeed bent. It is clearly time to get an EU based company who is ruled by the gaming board then move to get bent software barred in the way that the americans closed poker sites. Thanx for the 2+2 lead. V

Now, if you did read the 2+2 thread it’s basically a bunch of people calling the rigtards, well, rigtards. So somewhere in there he found the one voice that agreed with him and he feels validated. Twenty people explaining why making baseless claims without evidence is retarded and two people questioning whether or not online poker is rigged . . . yes, you are not alone.

Also, many operators are licensed within the EU. Malta is in the EU and has the License and Gaming Authority (LGA). Gibraltar is kinda, sorta in the EU. They have the their own regulatory body. The Alderney Gaming Commission is also in Europe. So, uh, yeah, I guess some company should start offering poker in the EU. I mean, other than the several dozen who already are.

Another

JUST COMPLETED 320 HANDS ALL INS 68% OF 25% FAV OR WORSE WON YOU CHEATS

I’m not even sure what that one means. 68% of all-ins where he was a 25% favorite or worse, he won?

Another

hELLO MR OUR SOFTWARE REFKECTS NATH PROBABILITY. HAVE PLAYED 23 HANDS SEEN 2 FOUR OF A KINDS BOTH FLOPPED ACE KING AND STRAIGHT FLUSH ANOTHER HAND FULL HOUSE 2 OF AND SEVERAL SUC OUTS AS ALWAYS FROM UNDER DOG. YOU EITHER ARE QUIRE DUMB OR LIE TO PROTECT YOUR COMPANY. ONLINE IS SO BENT

photocred goes to figlioDiOrfeo♥

Online Poker Rooms Getting Stupid About Sponsorships

Bill Rini — Mon, 26 Jan 2009 01:12:03 +0000

I was reading the other day about how PokerStars has banned its players from playing on Poker After Dark. I guess the argument goes that outside of the US Full Tilt Poker is all over this program and even markets it in some countries as a Full Tilt Poker production. Well, good for them. Not because I used to be associated with Full Tilt but that’s just how media and advertising work.

It seems petty for Stars to pull their players from the show. I can’t help but wonder had the UIGEA never happened would Stars been as bold when they were a distant number two in the market. I don’t mean to single Stars out but even going back several years I remember that there was a top name pro who was told that she could not play at certain live events because her online sponsor (not Stars) didn’t like something about those other events.

Obviously, the pros have the right to sign with anybody they want and the rooms have the right to ask for any sort of restrictions that they want but is it really any good for the game if we start to have televised poker that only features players from a specific online poker room? Okay, maybe Full Tilt might get away with it because of its deep roster of pro players but how interesting of a lineup can most rooms put up? Yes, Stars has a few big names but other than Daniel how many could you watch week in and week out? Nothing negative against many of the other pros on Stars list but many of them don’t make for great television and last I checked most games need 9 or 10 players unless you’re going to specialize in televising short-handed matches.

I wrote about something similar when the UB / Poker News / Tiffany Michelle thing broke. All of this wheeling and dealing just to get your logo on television is really going to start having a negative impact on the game unless someone steps up and establishes some industry guidelines. Yes, it’s a competitive market but sometimes you have to take one on the chin, dust yourself off, and do what’s best for the entire industry. Not because it’s the honorable thing to do but because winning a petty pissing contest often costs you more than you gain.

The Definitive Guide to Online Poker Cheating

Bill Rini — Wed, 16 Apr 2008 18:25:28 +0000

With all of the recent scandals involving cheating in online poker I thought I would take a few paragraphs to describe all of the various ways people can cheat at online poker. First off, “cheating” is a pretty broad term as some may consider abusing the disconnect protect feature on a site as cheating while others may simply view it as angle shooting within the bounds of the rules. Also, some things fall under poker scams rather than cheating as they don’t actually involve poker play. If I have missed something that you think should be included let me know.

Angle Shooting

Disconnect Protect Abuse

Many poker sites offer tables that have disconnect protection. The way this works is that if the software detects that the player has become disconnected the player’s hand will not be folded and he will be allowed to see the river without putting any more money in the pot.

The reason for this feature is that going back to the early days of online poker many people were still on dial up internet accounts that were unreliable and players would often become disconnected in the middle of a hand and they would be folded when they were unable to act in time. Today the feature carries over as poker rooms expand into new territories where the internet infrastructure is still immature and unreliable.

Unfortunately this allows a player who may feel that his opponent has him beat to pull the internet connection on his computer and thus see whether or not he has the best hand without putting any more money in the pot.

Poker rooms typically attempt to stop the abuse of this feature by only allowing players a set amount of disconnect protects. After they have reached their limit they will be folded if they fail to act in time. However the abuse still continues because players will often ask to have their limit reset and barring other players complaining the poker room will typically honor the request. Obviously, the best way to avoid people shooting this angle on you is to complain when you feel another player is abusing it. When he asks for a reset the poker room will see that other players have complained and will likely not reset his limit.

Short Stacking

This is more angle shooting than cheating but a lot of players will buy into a NL table with the min buy-in and look for the opportunity to get all their chips in the pot on a big hand. After they double up they leave the table and go sit at another table with the min buy-in and repeat the process. I can come up with some arguments why this might actually be -EV for the short stacker as well as see how it’s frustrating to players who have just doubled up some angle shooter but as long as they’re not sitting back down at the same table they are playing within the stated rules of the game and it’s something players need to adjust their game for.

Hacking

Trojans, Virus, Phishing and Keyloggers, Oh My!

I’ve been using computers (and the Internet) for roughly 17 years and I can count the number of times I’ve been hit by a virus, trojan horse or some other nasty on a single hand. And I used to play around with virus code just to see how they did what they did. In other words, it boggles my mind how many people fall prey to downloading and installing malicious software on their computer.

If you allow someone to install malicious software on your computer all sorts of bad things are possible. Since this is about online poker the most likely scenario is they write something that either:

a) Communicates your hole cards to them

b) Records all of your passwords

Perhaps in another post I’ll outline security tips to lock down your system but most hackers don’t even need to go that far. They just send people emails saying that in order to collect your bonus you need to confirm your login information by going to some site they set up to look like your favorite online poker room and people simply hand over their login details to them. No online poker room is ever going to ask you to do that!

Social Engineering

Social engineering is a term from the computer hacker world. Essentially it means to get someone to give your information. For instance, I can try to break into your computer by brute force – trying all sorts of random passwords – or I can simply call you up at work and tell you I’m from the IT department and I need you to confirm your password to me over the phone or I’ll have to lock your account.

Similarly, scammers will often get you to hand over account passwords or other information in order to gain access to your online poker account. Sometimes it’s as simple as someone typing into a chat window that he is a system administrator and he needs you to confirm your account details. Sometimes the scammer will send you to a link which asks you to login using your poker room account information in order to get a special bonus offer.

No poker room would need you to confirm your login information. The passwords are stored encrypted so even the poker room employees don’t know them so they would have no way to confirm whether or not you’ve given them the correct password. Also, never click on a link in a dealer chat window that doesn’t go to the site you are playing on. In other words www.ultimatebet.scammersite.com is not the same as www.ultimatebet.com.

Cheating

Collusion

Collusion is when two or more players at a table work together to defraud one or more other players at the table by sharing information. It could be as simple as two guys using IM to warn each other when they have a big hand. More intricate collusion methods include employing specific strategies to get other players to put more money in the pot. The standard method is the squeeze play. In the squeeze play two players trap a player between them and raise and re-raise each other forcing the player in the middle to keep calling. One of the two colluding players will have a monster and the other can have anything because he will fold his hand on the river.

Here would be an example of the squeeze play in action:

Colluder one is dealt 72o

Mark is dealt KK

Colluder two is dealt 66

Flop comes 69T rainbow

Colluder one bets

Mark raises

Colluder two re-raises

Colluder one re-raises

This continues on every street and then Colluder one folds to a single bet on the river and never shows his 72o.

Another variation on this is Colluder one and Colluder two to just raise and re-raise some third person out of the pot.

Colluder one is dealt 72o

Mark is dealt JJ

Colluder two is dealt 56o

Flop comes ace high and Colluder one and two get into a raising war which makes the Mark lay down the best hand fearing that one or both colluders hold an ace.

Fortunately, collusion is one of the more simple forms of cheating for both players and the poker room to detect. Most players catch on pretty quickly and either refuse to play with the two colluders or they can report them to the poker room who will investigate and take appropriate action. The poker room itself likely has checks in place that will alert it to suspicious activity. For instance, two players who always play at the same tables might set off an alert. At that point a human will step in and review the hand histories and attempt to determine if there is something fraudulent is going on.

The Inside Job

This seems to be what happened over at Ultimate Bet and Absolute Poker. Some employee, ex-employee, consultant or someone who has access to the poker room’s systems builds a little back door that allows them to somehow gain an unfair advantage against other opponents. In the case of Absolute it was an ex-employee/consultant who had a way of looking at other people’s hole cards which allowed him to make amazing calls with a hand like ten high and take the pot.

While most poker rooms are pretty honest Absolute Poker’s response speaks loudly about how difficult it can be to do something about this type of cheating. First Absolute denied it and then they admitted it but said it was very limited and then it came out that it may have been far wider than previously admitted. Poker rooms have a reputation to protect to even if they are aware of the cheating they would like to treat it very hush-hush as Absolute tried to deny when they initially denied any problem. If it wasn’t for the fantastic sleuthing and data analysis of message board posters on 2+2 Absolute would have likely continued the “no cheating happened” company line and then fired those responsible behind the scenes.

The good news about this type of cheating is that players can do their own research. If another player is winning a statistically improbable number of hands and he’s calling down bluffs with ten high then he’s going to be pretty easy to root out. However the bad news is that because of the Absolute and Ultimate Bet scandals future crooks will likely be much more careful. Instead of trying to get too greedy and win every pot they’ll only use their advantage on the critical hands that can give them a massive edge in a tournament. A guy who makes a four or five critical plays to his advantage in a tournament isn’t likely to set off too many warning bells. And as long as the crook doesn’t abuse the power he has he can probably go undetected for as long as he wants to. Granted, a guy winning every big Sunday night tournament is going to look suspicious but it wouldn’t be too hard to clear a few million a year in cash games in tournaments and just be considered a really solid player.

The only real solution here is more transparency from the online card rooms. They can’t be regulated by organizations that have a vested interest in keeping cheating hush-hush. They need audited by outside third parties who answer to players or a regulatory agency rather than getting a paycheck from the card room. Players with access to certain types of systems need to be bonded and submit to thorough background checks. That isn’t to imply that there’s anything unscrupulous going on currently in these relationships only that if you want real security then you have to eliminate not just actual bias but potential bias as well.

Multi-Accounting

Multi-Accounting is when a player plays multiple accounts at the same time on the same online poker room. Several high-profile cases have been uncovered over the last few years where a player entered a tournament under several different accounts. The worst case scenario is the player has two of his own accounts at the same table and thus could engage in all sorts of acts considered to be collusion. That is random and relatively rare compared to the fact that this one player simply gets multiple shots at the same prize as everyone else.

Account Selling

This has come to light more recently and basically when a player plays a tournament and is then offered the opportunity to sell his stake in that account to another player who then takes over the account and completes the tournament for him. The biggest problem created by this is that this is usually done when the tournament has worked its way down to a final few players (maybe the last 2 – 3 tables or even the final table). All of a sudden another player takes over the account and plays much differently than the original player eliminating any tells other players may have picked up on that player over the course of the tournament. Compounding the problem is that the purchaser of the account can ask the seller for his read on all the other opponents and can even go back through hand histories and figure out all the other player’s playing styles.

If the players engaging in this are very stupid then it should be easy for the poker room to catch them as one player logging in from Los Angeles, Ca suddenly disconnects in the middle of a tournament and then logs back in from Russia a few seconds later should set off a few alarm bells. But if the two players happen to be in the same room and they simply swap seats it is a very difficult accusation to prove because many players will change up their playing style at various stages in a tournament. The poker room would need to go back and look at a large data set of previous tournament data and see if this was an unusual shift in playing styles. And even if they did conclude it was out of the ordinary who’s to say that the player didn’t just get done reading a chapter on late stage tournament play and was following the advice given in the book?

Poker Bot Software

I’m going to throw any sort of aided game play including tools that tell players what to do even if they have to take the physical action of clicking the buttons. However that is not to be confused with tools that simply give you information about your hand but do not recommend how you play. I tend to draw the line at the recommendation level. Some might question that and say that a tool that tells a player the pot odds and the odds of making his hand might as well be making a recommendation but I would answer that those are simply data points the player could have calculated himself anyway. Equally important would be what range of hands you can put your opponent on, how he plays draws vs. made hands, whether or not he can fold a big pair if a scare card hits, and a lot of other data points which may be as valuable or more valuable than the simple pots odds and odds of making your hand.

Personally I think poker bots get far more attention than they deserve. No poker rooms have ever published any data on how many poker bots they suspect are on or have been on their systems but I would guesstimate that it’s relatively low compared to the amount of hysteria that the media, fear mongering politicians, and anti-gaming advocates portray it to be. That’s not to say that poker bots should not be vigilantly pursued and stopped but when someone says that they don’t want to play online poker because of all the bots it says to me that someone has put the scare into him without putting the problem into proper context. I remember the same scare tactics used in the early days of the internet when people said giving their credit card information to Amazon was akin to financial suicide. While payment systems security has improved some over the last decade or so since those sorts of headlines were mainstream, the main shift has been that the convenience factor won out over fear. As people became more educated about the risk they made better informed decisions and now eCommerce is a commonplace activity.

The reason I lean in the direction of thinking the threat is overblown is because most poker bot software sucks. It’s the lack of knowledge about how poker bots work and what they can and cannot is what both fuels fear as well as the greed that causes people to plunk down hard earned cash to buy these crappy products. Think about it, if you had a license to print money would you start selling the know-how to other people for $200 or $500?

At the most basic level a bot is simply a piece of software that can take certain actions. A poker bot can be programmed to push fold, call, raise buttons based on some sort of semi-complex array of if/then statements and scoring. That sounds a lot more voodoo-ish than it is. This blog that you’re reading also makes hundreds of if/then decisions every time someone visits my site. What page was requested, is the user logged in, what theme should be displayed, etc, etc. Semi-complex decision trees are what computers are designed for any every program does them.

So what makes poker bot software special? Nothing really. In fact, poker bots are nothing more than automation tools. You tell the poker bot that if you have pocket aces that it should move the mouse over the raise button and press it. You tell the poker bot that if you don’t have the pot odds to make a call on the turn it should move the mouse over the fold button and click it. Obviously they get more complex than that but that is basically what you’re stating off with.

The problem is that your poker bot is only as good as the poker strategy you program into it. And the vast majority of the poker bots you see being sold by internet hucksters simply aren’t that good. One of the more “popular” poker bots is a heaping pile of crap. But it allows the user to write his own code to customize it with his own poker strategy which seems to be its biggest draw.

Now let’s do a little ROI calculation here:

If you can beat a $3/$6 limit game for 3BB / 100 hands and you buy this software and have to customize it every hour you spend customizing the software is an hour you’re not earning your 3BB / 100 hands. And to make it even worse, even on the seller’s own developer forums most of them are either losing money with their poker bot or they’re making a miniscule profit. Even if we grant the guy 1BB / 100 hands he’s got to run three instances just to break even with what he could be doing on his own.

Now let’s factor in that the guy has probably spent weeks or months getting his poker bot fine tuned which was lost income of 3BB / 100 hands and he’s going to need a better win rate than break-even to make up for all of the time he’s put into it. He’s got to put up 4 or 5 machines. And he doesn’t get to go sit on the beach all day as the money comes rolling in because even the best strategy is going to take a variance whacking so he’ll probably want to watch over his poker bots while they play in order to make sure they don’t go crazy on him and drain his entire bankroll.

Over time the owner of this little poker bot could also find himself up against live players who exploit flaws in the strategy programmed into the bot causing his returns to go into the red. I know I’ve played against a few poker bots and they always seemed to have an easy to identify pattern that could be exploited. Some had trouble playing against super-aggressive players. Some gave away way too many free cards if they had weak hands.

Now that I’ve tried to dismiss most concern about poker bots I do have to say that there are more sophisticated poker bots that people should be concerned about. They utilize artificial intelligence (AI) in order to learn and adapt to the game. They are more difficult to beat and can be very sophisticated. Unfortunately someone good enough to create such a piece of software is likely smart enough not to do anything that would set off any red flags. That’s good news in the sense that you likely won’t find something that powerful mass-marketed to any idiot with a few hundred bucks in his pocket.

The reality is that poker bots and poker rooms play a game of cat and mouse. One side comes up with a way to detect and block them and the other side finds a way around the new defences. The good news for players is that the poker rooms seem to be doing a fairly good job and unless things turned decidedly in favor of the poker bots it’s as safe to play online as it is to be on the internet in general. Yes, there are some bad things out there, malicious software, phishing scams, etc but if you exercise a little common sense you can head off most problems.

Fraud

The Big Heist

While online poker rooms directly ripping off customers is fairly rare it has happened in the past and will likely happen in the future as long as the industry remains relatively unregulated. Many of the early card room failures were the result of player monies being co-mingled with the casino’s assets which can often prove to be a tempting pool to dip into if a cash-strapped casino/card room is looking to make a big marketing splash or perhaps even an acquisition.

If you play at any of the top card rooms the chances are very low you’re going to get ripped off like this. However if you’re playing at Offshore Jack’s Zany Poker Room because of the 1000000000000000000% deposit bonus your funds are only as safe as the ethics of the operator.

Scams

The creativity of scams is only limited by the imagination of the scammer. The most common types of scams are other players asking for loans, handouts, or some sort of trade. For instance a player on PokerStars may need to get money into his Full Tilt account so he’ll post on a message board that he’s willing to trade $101 on PokerStars for $100 deposited into his Full Tilt account. The scammer accepts the offer and then gets the Mark to transfer the money first and then never transfers the money on the other site.

Since the poker site can’t confirm whether or not a transfer has occurred on another site they usually will not get involved in these sorts of disputes. Your best protection against this type of scam is to never transfer money to other players that you don’t know very well and can trust. Set up proper deposit and withdrawal methods that will allow you to handle your own finances rather than relying on the kindness (or greed) of strangers to move money from one place to another.

Chip Dumping

Chip dumping can be done for various reasons but the one that tends to impact players is during tournaments or cash games where one player intends to give all of his chips to another player. In cash games it can result in lots of unnecessary re-raising which drives other
players out of pots and during tournaments the goal is to give the target player a nice big stack so he can go late into the tournament. Both are a form of collusion though the two (or more) players involved in the collusion may not have any concern about taking chips off the other players. Their goal is to pass chips from one player to the other.

Money Laundering

Money laundering usually isn’t directed at other players but it can impact other players if the means is via chip dumping and/or fraudulently taking control of another player’s account to move money around. Basically the idea is to take illegitimate money and make it look like legitimate money via winning.

Phishing

I’ve discussed fishing elsewhere so I’ll just mention it here as a placeholder as it does qualify as a type of fraud.

Conclusion

Cheating is always going to happen in poker. It goes on in live games and online. Live games have opportunities to cheat via dealer cheating, chip grabbing, and all sorts of other scams.

5 Hottest Female Poker Players You’ve Probably Never Heard Of

Bill Rini — Sun, 21 Jan 2007 10:12:20 +0000

	Cecilia Nordenstam Not very well known in the US but she’s been very successful in Europe. In 1995 she had 5th and 13th place finishes in the Five Star World Poker Tour Classic. She also seems pretty camera shy but I was able to find this one from LasVegasVegas.
	Veronika Larsen Norwegian Veronika Larsen is a former rep for Betsson who chucked her day job to become a pro poker player in Europe.
	Ashley Dorenzo Former model for Hollywood Poker who decided she would rather spend her time on the other side of the table. She’s taking a shot at playing professionally.
	Helen Chamberlain Helen is a presenter on UK’s Soccer AM but recently took down $400,000 placing second at the 2005 Poker Million tournament.
	Jean Gluck Jean is a pro player making her way up the ranks at the middle and high limit tables.

Honorable Mentions

The following are honorable mentions only due to the fact that their names are becoming a little more well known.

	Joanna Krupa Polish born Joanna is a spokesperson for Titan Poker and has been sent on the poker circuit to represent the company.
	Erin Ness Erin came into the spotlight after winning a company poker tournament at Maxim Magazine where the top prize was an entry into the 2005 WSOP Main Event. She came in 207th at the WSOP and ESPN showered her with coverage. She then appeared on Poker Royale: Young Bloods where she beat out several top pros to come in second to David Williams.

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