Is rake back dead?

Is rake back dead?

Party Poker splitting from Empire Poker, and its other skins, Coral Eurobet, Multipoker and Intertops, will obviously have far reaching implications for the structure of the online poker industry going forward. However, the split will no doubt have immediate implications for the hundreds of affiliate web site owners, and players, who have been involved in the practice of rake back.

Rake back is the practice of affiliates signing up players and offering them in return a per cent of their rake back in cash. The rakeback they offer is slightly less than what the affiliate receives from the poker room. Generally, this percentage is in the range of 20-30 percent. Historically, Party Poker has been strict on rake back by not providing the facilities for affiliates to track individual player turnover. As such, Party Poker affiliates have found it difficult to offer rake back. However, Party Poker skins have not been so strict. Under their affiliate agreements with Coral, Empire, Multipoker and Intertops ('the skins'), web site owners have managed to attract vast numbers of players by offering them rake-back. Many of these players were initially Party Poker players. These affiliates have made a small percentage from each player, but signed up thousands upon thousands of players. The players have benefited by getting a decent proportion of their rake back and the websites have profited enormously over the past year or so. All of these players have had the privilege of playing on the Party Poker network. Understandably, Party Poker was not too happy about this whole rakeback thing.

With the recent split, most of the pros on the circuit that I have talked to, that were receiving rake back, have stated they will not play on the Empire (and skins) network. If you read a lot of the forums around the place, rake back players and affiliates are understandably devastated by the split. The problem is that the games are too tight on the skins network. It's all a bit circular really. Historically, the skins have attracted a higher proportion of pros because of the rake back facility, after the split the skins games have been tight, because of the high proportion of pros.

Is rake back dead?

The main benefactors from the split are obviously Party Poker and party poker players. Party Poker, will no longer be supporting the growth of one of its' main rival (Empire Poker). Party Poker players will enjoy looser games, at least in the short run until the pros re-populate. How the skins fair in the longer term is up for debate. Player numbers do suggest that they will remain profitable. There is certainly a decent enough base to build a very health business from. In fact, together the skins would probably be the 3rd or 4th largest room. It is possible that they could challenge Party Poker and PokerStars in a very short time frame.

All of this is speculation. One thing that is true is that, while rake back might not be dead it has been mortally wounded. It will be interesting to see how things develop over the next 6 months. We might see rake back sites coming up with elaborate methods to track Party Poker rake, who knows what the future will hold?