Playtech enters Rakeback debate

Playtech poker boss Danny Frishman has entered the rakeback debate,saying that giving players linear percentages is "killing the industry". :pissed:

http://www.egrmagazine.com/news/indu...industry.thtml

The thing is that he's right - from an operators point of view. Operators need strong profitable stable rooms.

Being lowest cost - or lowest rake - or offering biggest rakeback - is initially enticing for an poker room / rakeback affiliate - but it quickly gets into a how low can you go scenario with both parties prepared to cut margins to below sustainable levels in order to get the business.

Anyone can go lower - as long as they're prepared to bleed profits.

What online card rooms need to be doing is building brand loyalty, through service, through game offerings, through software development etc. but as they're all tied into playtech software there is little real ability for the rooms to differentiate themselves.

Just look at the real world and compare the table rakes as the major Vegas casinos, to the low rent domwn market places. The big boys don't try to be lowest cost - the deliver VALUE through different services, offerings, and side offers.

The real question is - how do online card rooms do the same thing when they're all leasing the exact same software from operators like playtech?

Quote:

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Playtech’s head of poker also defended the affiliate lifetime revenue share model, which has been the focus of mounting criticism from some commentators for reducing the amount of money operators have left to spend on retention. Frishman said the model provides a strong incentive to affiliates to bring in quality traffic and enables operators to reach emerging markets and niches they would otherwise be unable to.

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This is what's important to me.
We don't want to see any more Grand Prive's!

Great points Gooner.

And if the rakeback was strictly in the hands of the operators, all rooms (as well as affiliates) would be on a level playing field as far as the amiunt of rake collected or redistributed to the players, and thus allowing the operators (as well as affiliates) to add their value in service etc like you suggested.

Rick
Universal4

Thought you might all might appreciate our August feature:

http://www.egrmagazine.com/news/indu...k-rumble.thtml