Michael Josem Rebuttal vs (Alleged) “Rationale” Behind PS changes via John Nash lecture and Ideal Poker

(the following is a rebuttal of Michael Josesm’s latest “rationale” by using excerpts from a year old manifesto called “Ideal Poker“)

Hello Players,

In recent weeks, PokerStars has made several changes which have upset some players. We’ve heard these complaints and are genuinely listening to the feedback. No one likes higher costs and we appreciate that point of view.

The special commodity or medium that we call EV has a long and interesting history. And since we are so dependent on our use of it and so much controlled and motivated by the wish to have more of it or not to lose what we have we may become irrational in thinking about EV and fail to be able to reason about it like a technology, such as radio, to be used more or less efficiently

So I wish to present the argument that various interest and groups, notably including PSFTFBICIADOJ has sold to the players a “quasi-doctrine” which teaches, in effect, that “less is more” or that (in other words) “raked poker is better than not raked poker”.

In recent years, we have also heard many high-volume, professional poker players say that the games are tougher now and it’s harder to win than in the past. This is one of the reasons we’ve actually reduced rake previously, which helps the ROI of these players. But that’s not making the games any softer, which is what would really improve ROI.

PSFTFBIDOJ implicitly always have the argument that some good managers can do things of beneficial value, operating with the skins, and that it is not needed or appropriate for the players or the “customers” of the chips supplied by the site to actually understand, while the managers are managing, what exactly they are doing and how it will affect the “ROI” circumstances of these players.

Instead, we need to invest in new ways to improve the poker economy.

It was the observation of a new “line” that has become popular with those responsible for “raked” functions relating to national poker sites that gave us the idea for the study of “asymptotically rakeless” poker.

The idea seems paradoxical, but by speaking of “rake targeting” these responsible officials are effectively CONFESSING that, notwithstanding how they formerly were speaking about the difficulties and problems of their functions, that it is indeed after all possible to control rake by controlling the supply of chips (as if by limiting the amount of individual “prints” that could be made of a work of art being produced as “prints”).

Over recent years, we have been developing ways to grow that we believe will attract new players and reactivate players already in our database. Such initiatives include new poker variants, expansion into other gaming verticals, and new marketing approaches. While we understand that not all players are satisfied with the short-term impact of these changes, the reality is they have the potential to increase poker liquidity.

Our observation, based on thinking in terms of “the long term” rather than in terms of “short range expediency”, was simply that there is no ideal rate of rake that should be selected and chosen as the target but rather that the ideal concept would necessarily be that of a zero rate for what is called rake.

However, initiatives to attract players require significant investments in areas of marketing, promotions and product innovation.

A related topic, which we can’t fully consider in a single lecture, is that of the considerations to be given by the poker society and poker sites to “social equity” and the general “economic poker welfare”. Here the key viewpoint is methodological, as we see it. HOW should the poker society and the poker site authorities seek to improve economic poker welfare generally and what should be done at times of abnormal economic difficulties or “depression” (variance)?

We can’t go into it all, but we feel that actions which are clearly understandable as designed for the purpose of achieving a “social welfare” result are best.

Additionally, in order to not only secure our continued place as an industry leader across the globe but also to grow ourselves and the game globally, we continue to lobby for the regulation of online poker and attempt to obtain licenses in many newly regulated, locally licensed jurisdictions. We support regulation because we believe it ensures game integrity, player protection, and increases the recognized legitimacy for the game itself. However, there are obviously significant upfront costs to these efforts as well as ongoing costs in the form of gaming license fees and duties.

The paper called “Ideal Money” that was recently published in the Southern Economic Journal presented a possible conventional basis for money of “ideal” type. This variety of money would be intrinsically free of “inflationary decadence” similarly to how money would be free from that on a true “gold standard”, but the proposed basis for that was not the proposal of a linkage to gold.

But it seems very likely that, although that scheme for arranging for a system of rake with ideal qualities would work well, that, on the other hand, it would be politically difficult to arrive at the implementation of such a system.

(One can observe, for comparison, the difficulties that are found in connection with issues of which national regions should or should not be included with the group making use of the new “poker” currency. For example, the US player would like to become world members but the PSFTCIAFBIDOJ are not convinced that they would be beneficiaries by inclusion.)

The funding has to come from many places and it is perfectly reasonable that some of it comes from reducing certain costs, which was the rationale for some of the changes to our VIP program, stemming from a review we began early this year, as well as charging a margin on currency exchange fees. It is also the rationale for our changes to the rake.

In the near future there may be a smaller number of major sites used in the world and these may stand in competitive relations among themselves. There is now the “euro” sites and the old history of the UB scandal is past history now. And there COULD be introduced, for example, a similar international site for the Islamic world or for South Asia, or for South America, or here or there.

If we can grow poker, everyone will benefit. Even our competitors will benefit, because in a rising tide, all ships rise.

And if “rake targeting” were used as a “line” by the managers handling all of these various internationally prominent sites then there would arise interesting possibilities for comparisons between these major sites. Each of the sites managed thusly would have its officially recognized status in terms of rake as measured by the domestic index of deposits raked of the state of the managers. But also, and this is what is more significant from an internationally oriented viewpoint, the various rakes would have rates of exchange so that they could be realistically compared in terms of their actual values.

Finally, it has to be said that our rake, our currency exchange rates and our VIP program are all more competitive than those of our major competitors.

So here is the possibility of “asymptotically ideal (rakeless) poker”. Starting with the idea of value stabilization in relation to a domestic ‘deposits raked’ index associated with the territory of one state, beyond that there is the natural and logical concept of internationally based rake comparisons. The sites being compared, like PSFTCIAFBIDOJ, Merge, Party Poker, etc. can be viewed with critical eyes by their players and by those who may have the option of whether or not or how to use one of them. This can lead to pressure for good quality and consequently for a lessened rate of rake.


Michael Josem
PokerStars Communications Team

There perhaps will always be “rake”, like also “death and taxes”. But it is sometimes remarkable how poker strategies can evolve. And in relation to that I think that it is possible that “PSFTFBIDOJ ” are like a political faction that will become less influential as a result of poker revolution. The “PSFTFBIDOJ” view of things did not come into existence until after the time when what we can call “Black Friday” had become established in the US. And by this label we wish to differentiate between any theoretical or ideal concept of justice and the actual form of governing regime structure that came to exercise state power on the poker community. (All over the world varieties of sites make claims to have systems very properly or even ideally devoted to the interests of the professional or recreational players of those sites and always an externally located critic can argue that the site is actually a sort of despotism.)

So I see the entire privately raked community as in a weak sense comparable to the “PSFTFBIDOJ ” because of the support of both parties for a certain “lack of transparency” relating to the functions of poker sites as seen by the players. And for both of them it can be said that they tend to think in terms of sites operating in a benevolent fashion that is, however, beyond the comprehension of the player of the raked sites. And this parallel makes it seem not implausible that a process of poker revolution might lead to the expectation on the part of players in the “great game types” that they should be better situated to be able to understand whatever will be the rake policies which, indeed, are typically of great importance to players who may have alternative options for where to place their “deposits”.


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