Ever wondered how casinos make money from providing games of poker, despite it not being played against the house?
Poker isn't like most other casino games, where players go directly against the casino itself in some way. In this game, players compete amongst each other, and the casino acts as the host or facilitator of the game. This seemingly small detail is actually the key to understanding the casino's business model when it comes to poker.
Join us as we dive into the world of poker rooms, casino fees, and how these venues cleverly ensure they get a piece of the action while players go head-to-head in this popular casino game.
House Edge In Poker Explained
In traditional casino games, the "house edge" is the casino's way of ensuring a long-term profit by giving the house a statistical advantage over players. This advantage is built into the rules of the game, for example, the zero pocket(s) in roulette and the order of play in blackjack.
However, poker is a bit different because the casino isn't playing against the players, so there is no house edge.
Instead, the casino takes a small percentage of the pot for itself. This is called the "rake". The rake is like a service fee for hosting the game. The amount taken is usually capped, so even if pots are large, players don’t get charged too much.
Some poker games may charge players an hourly fee instead of a rake per hand. This fee is more common in cash games where people sit down and play as long as they like.
What Is Taking a Rake in Poker?
In poker, a "rake" is a small commission taken by the casino as a fee for hosting the game. It's how casinos make money from poker in a game where they don’t directly compete against the players.
There are different ways a rake can be collected, each varying slightly in approach. Let’s take a look at some.
Pot Rake
Pot rake is the most common method. Here, the casino takes a percentage of the total pot from each hand. This percentage is usually capped, meaning there's a maximum amount the casino can take, which keeps the rake fair for players, especially in large pots.
Dealt Rake
With dealt rake, each player who receives cards for a hand contributes equally to the rake. This means everyone at the table pays a small portion, regardless of whether they stay in the hand or fold before the showdown.
Contributed Rake
In a contributed rake system, only the players who actually contribute money to the pot pay towards the rake. This means if you fold early without betting, you’re not paying a rake for that hand.
Weighted Contributed Rake
This method is a twist on the contributed rake. Here, the rake is distributed based on how much each player has contributed to the pot. The more you bet in a hand, the more you contribute to the rake amount. This method aims to fairly allocate the rake based on participants' involvement in the pot.
Do Casinos Make a Profit From Poker?
Yes, casinos do make a profit from poker, even though they don’t play against the players directly. Their main source of income is the rake, a small fee taken from each pot, which we've outlined above.
By charging a rake, the casino ensures a steady income from every hand played. This means that whether players win or lose amongst themselves, the casino still benefits from each round played.
In some venues, instead of or in addition to a rake, players might pay an hourly fee to play at the poker table. This is especially common in cash games, where players can join and leave as they please.
Additionally, casinos may host poker tournaments with entry fees. These entry fees can generate significant revenue, especially in large tournaments with many players.
Casinos also make money from the amenities that support poker games, such as food and drinks, making poker rooms a valuable part of their overall offering.