May 13, 2011

My last post & current thoughts...

So, Blogger (the platform this blog is published on) apparently had some major issues and had to remove any posts made in the last couple of days. Consequently my last blog post, in which I had a fair old rant at PokerStars, was removed. This morning I was absolutely bricking it because I wasn't aware of the technical issues, so I thought the only explanation must be that I had said something libellous, and the PokerStars solicitors had been in touch with Blogger! My girlfriend won't thank me for that piece of laundry!

I'd already been thinking that perhaps I'd gone a bit too far in my judgements on PokerStars' meddling with SNGs. Though I do think all the points I made are valid, at the end of the day, they are their own mistakes to make. Yes, I am a paying customer, and have every right to criticize, but I am also very lucky to be able to earn a comfortable living by playing poker on their website, and if I wasn't able to play there it's very likely I would make less money for me and my family. Isn't there a saying about biting the hand that feeds you?

Also, whilst I am complaining bitterly about decisions made in relation to SNG changes, I'm probably not giving the site as a whole a fair rap. PokerStars is clearly still the nuts when it comes to software (and continuous improvements to their software) customer service (the way they have handled things since Black Friday has been admirable, though clearly it might have been advisable not to commit alleged fraud in the first place!), and amongst other things, it is the only place you can realistically grind MTT SNGs.

Nevertheless, it remains true that PokerStars have handled things extremely badly recently in regard to SNGs. If they weren't going to follow through with their promise to decrease rake, why tell people they were going to in the first place? To go one step further and increase it (in the games with the highest traffic) was just plain mean. Furthermore trying to BS us that the rake changes represented a rake decrease, twice, was hugely insulting. 

PokerStars have made lots of other mistakes (discussed here) in the last week (as comically derided in this 2+2 post), but to their credit, at least they are clearing them up one by one, and they do seem to be paying attention to the feedback given to them by players on 2+2. It does seem rather unnecessary to have lost a week of play because of the mess that was created though. Still, personally I can go to playing my $20-$100 18-mans quite happily, with the structure now back to how it was originally (except for an extra level at 150/300(25) which seems a reasonable addition). Of course if I were a $6.50 or $16 player, I would have had to leave the word 'happily' out.

Thankfully it seems that the un-rounded buy-in amounts are now in the process of being changed, reflected by the changes to micro-stakes games which were implemented today. Soon, only one issue will remain, it is the most important; rake. I really hope PokerStars lose the attitude they have taken towards rake, and take the opporunity to readdress it when they adjust the buy-ins as they have for the micro-stakes. Unfortunately, the stubbornness that was evident in PokerStars' response to the backlash suggests they might not be willing to.

It's one of those situations where you are sure you are right, but you can't seem to get that point across successfully, no matter how many well articulated blog posts you write! It's a bit like trying to convince your parents they should no longer pay for gas and electricity separately, but they still choose to do it. You know it would save them money to get a dual-bill, truthfully they know it as well, but even though they can't give you a good reason to stick to their guns, they still do.

My argument is quite simple. If you reduce the rake, then games become more profitable. This encourages people to play more, and the winners are more likely to earn enough money from the games, allowing them move up in stakes. Although you would be directly reducing the immediate rake per game, it would be more than made up for by the increase in traffic that would result.

Such a scenario has been simulated, in this interesting post. Although it makes the flawed assumption that a player will be able to sustain the same finish distribution in a $50 SNG as they did in a $5 SNG, I still think it sufficiently demonstrates the positive effect reductions in rake could have, and the win:win situation that would result for both the poker site and the players.

The fact that STTs at the current level of rake are virtually unbeatable, and run so infrequently when you consider how much traffic their MTT SNG counterparts receive, is sufficient evidence in itself that rake reductions need to take place. They are still raked at a similar level to what they were 5 years ago, when the games were crushable and traffic in them was booming. Now they are often played only for rakeback, and consequently they are slowly dying. The games are positively calling out of a rake reduction, but they still relent.

Perhaps they are unwilling to take the risk of losing rake, especially as they are still trying to recover from the effects of Black Friday. However, I contend that the risk of increasing rake, changing all the buy-ins and altering all the structures was a much bigger risk. I think this is best explained in an overly-long equation:

   Making your customers happy
+ probability that traffic will increase
+ possibility that rake will increase in the long term
+ possibility that rake will decrease

is greater than...

   Risk making your customers very unhappy
+ possibility that rake will increase in the short term
+ possibility that traffic will decrease
+ possibility that rake will therefore decrease

Although initial traffic drop off since Friday (which really had me quite worried!) seems to have recovered somewhat, I hope this doesn't trick PokerStars into thinking they 'got away' with the rake increases. I think it's inevitable that the increase in rake in the $5-$20 SNGs will have a really negative impact on future traffic on the site.

As I wrote in my 'lost' blog post...

The low stakes games ($5-20) will no longer be as beatable, so less regs will be inclined to play them. They are the people who 'drive' the games (sit down first so other players are more likely to join a game that is likely to run than one that is empty), losing them will mean less games run. The break-even players will become losers and will stop playing, the good winners will become marginal winners, and may look for a different game and/or site. Recreational players will have less chance of winning, and bad players will lose faster, which may discourage them from playing as much. Also, less people will be able to make enough money to move up in stakes, and we will see a knock-on effect where the higher stakes games will lose traffic as well.

Had they taken the opportunity to make big rake decreases, as I suggested here, the exact opposite would have been likely. The games would become more beatable, so regs would be more inclined to play, meaning more games would run. The break-even players would become marginal winners, and would be encouraged to play more. The winners would become bigger winners and would be encouraged to move up in stakes (where they would pay more rake). Recreational players would have more chance of winning, bad players will lose more slowly, and consequently may be encouraged to play more as well.

PokerStars you have one more chance to put this right, please make it third time lucky!

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3 Comments to "My last post & current thoughts..."

João Marcello said...

Hi james, congratz for your blog and your text. i would like knows if you sell your HH or if u coach.
I'm from brazil.
thank you. João Marcello

Unknown said...

Hi João,

Sorry but I don't do coaching anymore (TeamMoshman ftw if you are looking for this) and I don't sell hand histories.

fifithecat said...

Couldn't agree more about team moshman coaching being ftw. I finished my coaching in December last year.

And I just finished 7th for $5k in mid scoop ($215) shootout.