How Legitimate Are Players' Gripes With PokerStars?
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True Or False: Rating The Veracity Of The Poker Community’s Criticism Of PokerStars

inside PokerStars policy shift
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If you’ve been focused on the daily fantasy sports industry, or just woke up from a coma, or returned from a trip to the International Space Station, you may not have heard about the new policy changes PokerStars will be instituting. If you have been following along,you’ve likely seen a number of different criticisms leveled at PokerStars by poker players.

Some of these concerns are easy to confirm or disprove, others are a bit more complicated and nuanced. We’ve dug through and pulled out the more popular criticisms and tried to determine just how legitimate they are.

The premature ending of Supernova Elite and switch to StarsCoins penalizes players

By ending its Supernova Elite program early (becoming a Supernova Elite not only conveyed that status during the current year, but carried over to the next year as well), PokerStars is fulfilling its obligations to the players who chased who SNE status in 2015.  Stars is conveying a maximum of 45 percent rewards for these players in 2016, but SNE’s have historically earned between 54 percent and 59 percent rakeback.

Furthermore, it appears some players will lose out when PokerStars converts their FPP’s to StarsCoins at a rate of 1:1.2 after January 1, 2016. This conversion rate is below the optimal rate of 1:1.6 SNE’s can convert FPP’s at.

SNE’s will either have to quickly use their FPP’s or see their value diminish come January 1.

Verdict = True

PokerStars wants to make its games unbeatable

The idea that PokerStars wants everyone to lose money slowly is not only impossible, but it’s not want any online poker site would want.

First, if every winning player left PokerStars tonight, the most skilled of the remaining players would become the site’s winning players tomorrow. There will always be a skill gap between the best and the rest.

There are only two ways a poker site could turn everyone into a losing player:

  1. By jacking up the rake to an unbeatable level, which it is nowhere near at present.
  2. Or, if the skill gap between players all but disappears, which is also (at present) an impossibility.

What PokerStars actually desires is a diverse poker economy, where new players constantly enter the pool to replace the players that fall by the wayside, and still other players are a constant presence.

Quite simply, PokerStars isn’t trying to turn everyone into a break-even player; it is punishing a specific style of play employed by some winning players. As the company said in its press release on the changes:

“The reason we are focused on the highest status levels is because these rewards have become so enticing that we have inadvertently altered why some people play and how they play.”

Verdict = False

PokerStars is raising the rake in high stakes games

No offense intended, but this is like saying when a store has a sale where the price of cereal is lowered from $4 to $2, that when the price goes back up to $4 they have doubled the price. The rake hasn’t changed at all – what has changed is the amount of a refund you get for being a consistent customer. It’s more akin to a store ending its rewards card.

Now granted, PokerStars has been running this sale for several years, so I can see why many people think this is the actual price, but it’s not. The effective rake some players pay will be going up, but the rake itself hasn’t changed.

Verdict = Mostly false, but somewhat true from a certain point of view

PokerStars is cutting the rewards of virtually all players

The changes appear to be a near-across-the-board cut to VIP rewards, but by our calcualtions only the top players will see any sort of noticeable reduction in rewards.

The impact on PlatinumStar members (PokerStars’ highest monthly tier) will be rather minimal. Currently, the rakeback amount for a continuing PlatinumStar player who just barely maintains his status is $382 per month, equating to 28 percent rakeback. This assumes the player uses a portion of his FPPs to purchase online tournament tickets. If he takes the cash only option, his rakeback rate will only be 24 percent ($326).

To my understanding, under the new system the same continuing PlatinumStar member will receive $342.50 in rakeback per month, as cash. When compared to the current cash plus tournament tickets model, that equals a 10 percent cut. Yet when compared against the cash only option, which is the stronger point of comparison, it actually represents a 5 percent gain.

Granted, this is only one scenario of many, but illustrates that PlatinumStar member won’t be hit too hard by the VIP cuts.

The cutbacks are more impactful at the SuperNova level, which most PlatinumStar members who maintain their status will eventually achieve. At this level, my calculations show that players will receive between 27.6 percent and roughly 30 percent rakeback, with little variation between entry level SuperNova players and those who achieve the status 10 times over.

Entry level (100,000 VPP) SuperNova players currently receive about 29.4 percent rakeback, meaning they will hardly notice the changes. The disparity grows significantly at the 200,000 VPP level, as players who start the year at BronzeStar and work their way up to this benchmark will receive about 38.5 percent back on their investment. At the 800,000 VPP market, rakeback swells to 47.1 percent, and at SuperNova Elite (1,000,000 yearly VPPs) increases to between 54-60 percent.

In short, the new VIP cuts will only seriously impact players that generate at least $36.3k in annual revenue for the site.

Verdict = False

The increased benefits are insignificant and go to players in unbeatable games

Similar to the previously discussed criticism (PokerStars wants to make every player a losing player), a number of poker pros have zeroed in on the beatability of specific games. What this argument fails to consider is the simple truth that most people aren’t playing poker for the long run or to grind out a profit every month. A game’s long-term EV is about as important to the vast majority of potential online poker players as the long term EV of roulette or craps.

In his forum post criticizing the changes, Dani “Ansky” Stern writes:

“The only players who will see an increase in rakeback, are ChromeStar players. How much rakeback? Roughly 30 cents… Anyone playing small enough stakes to where this 30 cents matters to them is already playing in a game that is raked so high by stars that it is literally unbeatable (>15bb/100 rake is common at micros).”

First Dani is assuming that ChromeStar players only play microstakes games. He’s using “pro” thinking (use proper bankroll management, play 6-8 tables at a time, etc.) to rationalize what a ChromeStar player would look like.

What he’s missing is that many casual players play much higher than this, but don’t play often enough to achieve a higher rewards tier – maybe they only play on the train to and from work, or on Friday nights, or perhaps they play the Sunday Million every week and at the same time play a $2/$4 NLHE game. It’s extremely important to note that players who are low on the VIP ladder aren’t always there because they exclusively play micro-stakes games.

Still, Dani has a point that the micro-stakes games appear to be unbeatable.

The impact of the rake at lower stakes is disproportionately high for two reasons. The first is the “no flop, no drop” policy consistent on nearly every major online poker site. By nature, micro and low limit players are more passive, and thus more prone to engage in multi-way pot. Often times the winner is not determined until the turn or river.

By contrast, mid-to-high stakes 6-max players tend to settle the majority of their battles pre-flop. In other words, low limit players play more hands where the rake becomes part of the equation.

Second, and more importantly, low limit players are paying proportionally more per hand than PokerStars might have us believe.

At stakes $.05/$.10 and up, all players pay the same 4.5 percent rake. However, due to the way the rake cap functions, low limit games require that pots be 100 to 300 big blinds before the rake cap is reached. By comparison, at $3/$6, the pot size only needs to be 10 big blinds for the cap to be hit, and smaller still at stakes $5/$10 and above.

Low limit players are almost always paying 4.5 percent per hand, while middle stakes players are typically paying half that, or often even less.

At $3/$6, PokerStars rakes 1.125 percent from a 40 big blind pot, and .5625 percent from an 80 big blind pot. At $.10/$.25 it’s 4.5 percent at 40 BB’s and 80 BB’s.

Now, while low limit players should be paying a higher rake, as it incentivizes them to move up, once the differences between what the low limit player receives in rakeback vs. what the high volume, middle stakes player receives, the gap is simply too wide.

Verdict: True and false

Removal of VPP’s from high-stakes games will cause them to dry up

Another thread of this argument says that the mid- and high-stakes games will dry up because the pros won’t find them profitable and will move down in stakes. In a blog post at backdoorquads.com, Adam Owen writes:

“A lot of games will now not be beatable without rakeback. Now, you will not see reg v reg heavy games, as the required edge to break even and make a profit is now too high and will often be unobtainable.”

Owen’s argument is that because PokerStars has eliminated all VPP’s from high stakes games, no pros will play. And without pros to start the games and fill most of the seats, the casual players won’t play high stakes games either. Here’s the problem with that line of thought (and we actually have several real world examples of this we can turn to): If there are no pros, the games will become very beatable without needing to rely on rakeback.

As I established above, most casual players don’t necessarily play for rakeback or pick and choose tables based on the long term EV of the game. If they want to play $10/$20 Razz, they’ll play $10/$20 Razz. And if there are three or four poor players sitting in a $10/$20 Razz game, you can bet your bottom dollar a couple of pros will soon show up, rakeback or no rakeback.

PokerStars is actually undertaking an interesting experiment with this change. The games are only beatable with rakeback now because they are full of grinders, but if the dynamics shift and more casual players appear, the games will be beatable without rakeback. That’s PokerStars’ theory.

It would seem that what PokerStars has done by eliminating rakeback from all high-stakes tables is move to a system where recreational players start games, rather than hoping four or five regs will battle it out for rakeback while they wait for a casual player to arrive – a scenario that likely doesn’t appeal to a casual player.

I hearken back to this sentence in the PokerStars press release [bold mine]:

“… move towards a more balanced long-term poker economy and to return the game back to one that rewards skill via winning at the tables rather than playing primarily for volume.”

A lot of people view this as an insult to multi-tabling grinders using software, but I see it as PokerStars telling these players, “You won’t need to rely on volume to make money anymore.”

As I said in the past, most poker pros don’t really want to play this style, they’ve simply been forced to by the very policies the sites are now changing. It will be interesting to see if this can be accomplished.

Verdict = Uncertain

Robert DellaFave also contributed to this article.

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Steve Ruddock
- Steve covers nearly every angle of online poker in his job as a full-time freelance poker writer. His primary focus for OPR is the developing legal and legislative picture for regulated US online poker and gambling.