Before determining winners here, we first need to understand just what rakeback is, and how the money flow operates. Rake back is, in its simplest form, a movement of money from the poker room to the affiliate and back to the individual player. The hope is that the player will reinvest this money back into the poker account generating more business. In practice though, it's a bit more complicated than that.
Before we can look at who benefits from rakeback, we have to look at all of the players involved and figure out who is who. The poker player and the poker room should be fairly self explanatory. That leaves the rakeback affiliates.
The best way of looking at affiliates is to consider them as recruiters for the various online poker rooms. The affiliates usually offer deals on their websites from several poker rooms ranging from 25% all the way up to 50% rakeback. It's these affiliates that drive new players to the poker sites, and get them to stay. Now that we have their place in the puzzle defined we can move on to who is actually benefiting from this "pass the cash" circle.
First we'll look at the player's benefits. Online poker players pay rake on nearly every hand of poker that they play. This is a fee that the poker room charges to keep the games going and it certainly can add up fast. A player with a rakeback deal gets a percentage of this fee back from the affiliate that "recruited" him to the site. The obvious advantage for the player is money in the form of a rake rebate.
Poker affiliates have the same motive. These rakeback affiliates are individuals or companies that get paid by the poker rooms to go out and sign new players up to their sites. The poker rooms then pay these affiliates a percentage of the rake that all of their players generate. Some (not all) of this money is then paid back to the players to keep them happy. Happy players tend to spread the word and attract more players and more money.
Finally we look at the poker room themselves and why they allow rakeback and how it helps them. The answer is an easy one. Rather than investing a large budget in advertising their brand, the poker rooms have the affiliates do that promotion for them. In addition, rakeback is generally a good way to encourage a sense of loyalty between players and the poker room. In short it is a good business decision to allow affiliates to offer rakebacks to prospective players.
So the bottom line here is that everyone in the equation benefits. The player gets a bonus when a portion of his rake is returned, the poker affiliate gets a piece of the rake back from all of his players and the poker room gets to continue to generate more revenue as they grow their player base. In addition they only have to pay affiliates when they perform with new sign ups. If they employed an ad agency to promote the site they would have to pay fees no matter what the results.
It appears the only one who doesn't receive a benefit is those who are not involved in the process. Rakeback is free. It doesn't require you to play poker anytime or anywhere. Good luck in your future table play.
Before we can look at who benefits from rakeback, we have to look at all of the players involved and figure out who is who. The poker player and the poker room should be fairly self explanatory. That leaves the rakeback affiliates.
The best way of looking at affiliates is to consider them as recruiters for the various online poker rooms. The affiliates usually offer deals on their websites from several poker rooms ranging from 25% all the way up to 50% rakeback. It's these affiliates that drive new players to the poker sites, and get them to stay. Now that we have their place in the puzzle defined we can move on to who is actually benefiting from this "pass the cash" circle.
First we'll look at the player's benefits. Online poker players pay rake on nearly every hand of poker that they play. This is a fee that the poker room charges to keep the games going and it certainly can add up fast. A player with a rakeback deal gets a percentage of this fee back from the affiliate that "recruited" him to the site. The obvious advantage for the player is money in the form of a rake rebate.
Poker affiliates have the same motive. These rakeback affiliates are individuals or companies that get paid by the poker rooms to go out and sign new players up to their sites. The poker rooms then pay these affiliates a percentage of the rake that all of their players generate. Some (not all) of this money is then paid back to the players to keep them happy. Happy players tend to spread the word and attract more players and more money.
Finally we look at the poker room themselves and why they allow rakeback and how it helps them. The answer is an easy one. Rather than investing a large budget in advertising their brand, the poker rooms have the affiliates do that promotion for them. In addition, rakeback is generally a good way to encourage a sense of loyalty between players and the poker room. In short it is a good business decision to allow affiliates to offer rakebacks to prospective players.
So the bottom line here is that everyone in the equation benefits. The player gets a bonus when a portion of his rake is returned, the poker affiliate gets a piece of the rake back from all of his players and the poker room gets to continue to generate more revenue as they grow their player base. In addition they only have to pay affiliates when they perform with new sign ups. If they employed an ad agency to promote the site they would have to pay fees no matter what the results.
It appears the only one who doesn't receive a benefit is those who are not involved in the process. Rakeback is free. It doesn't require you to play poker anytime or anywhere. Good luck in your future table play.
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