How Do Casinos Make Money on Texas Hold’em

Hold’em Texas

Poker is definitely one of the most popular games in casinos, and it competes with slot machines for the top dog position. Unlike slots, though, poker doesn’t have any house edge. The players don’t even play against the house but against each other. That leads many to uncertainty about ways casinos earn money from card games.

Casinos would never host a game that doesn’t make them money, and just because Texas Hold’em is trendy, it doesn’t mean it’s an exception to this rule. The most apparent way casinos earn money from it are poker tournament entry fees.

Most of you have heard of insane sums of money being awarded to players topping tournaments. What’s even more mind-blowing is that the fees participants pay are usually even more substantial than the prize pool. Casinos can also receive money from sponsors or advertise certain products during the competition.

Another, albeit much more roundabout, way casinos earn money through tournaments is publicity. Tourneys are a big draw, not only for players but for viewers as well. Some are even televised or streamed online, drawing players to the casino.

Some casinos, besides hosting tournaments, will charge poker players to even sit down at their tables. That represents a guaranteed profit without much effort for the casino.

Tipping the Dealer

No table game would be enjoyable without a competent person running it. Poker etiquette suggests you tip the dealer if they are doing a good job. The rule of thumb most seem to agree on is to tip at least a dollar per a winning hand. The dealer will surely be thankful if you give them more than that, but you should be cautious — tipping too much is a great way to cut down your winnings.

Texas-Hold’em-poker

A piece of advice seasoned poker players like to give is not to withhold tips based on how the game is going. It’s not the dealer’s fault you got a few bad hands in a row, and tips are often their primary source of income. While casino owners don’t make any money off of tips, they are crucial for dealers. Make sure you tip great dealers at least something as it helps keep them around.

Another means in which a casino can profit, and the most common one, is raking players. That means they take a certain amount of money from any pot played at the poker table. Sometimes rakes can be collected even if a player hasn’t contributed to the pot at all; this is called a dead drop.

Rakes can be both fixed and percentage-based and are the most common in online poker due to the ease of collecting them.

Calculating Rakes

How rakes are calculated differs from casino to casino. The three most common methods of collecting fixed rakes are: dealt, contributed, and weight-contributed.

Dealt rakes are essentially dead drops; they are taken from each player at the table. If the rake was $5 and there were ten players present, each would need to pay 50 cents. Contributed are similar, but are only collected from players who added to the pot. Say five players fold right away; the others would need to pay $1.

Weight-contributed rakes are a bit more strenuous to calculate. They are taken from each player that contributes to the pot, based on the weight of their contribution. It’s easier to understand through an example, so we’ll give you one.

Four players are playing a hand, and the rake is $4. Two players bet $5 and end up folding, the other two finish off the round each betting $15. The former get raked 50 cents, and the latter pay $1.5. Since the last two contributed three times as more to the pot, they are raked three times as hard.

The other two variations of rakes are percentage-based rakes and timed rakes.

Percentage-based rakes simply take a portion out of each pot. Land-based casinos generally use timed rakes since they are easier to collect and don’t disrupt the game much. The casino will charge players in certain intervals, usually of 30–60 minutes.

Rakes, although they may seem insignificant, can drastically impact how much poker players profit. An average Texas Hold’em player could expect to break even over a longer period. That is due to poker being a game with no innate house edge. However, rakes make it so that average and even slightly above average players are actually at a loss due to giving part of their winnings to the casino.

Ways Online Casinos Make Money on Texas Hold’em

Make Money on Texas Hold’em

Many opt for enjoying the experience poker provides from their phone or PC instead of visiting a casino. The structure of online casinos also allows them to circumvent some of the ways traditional ones need to tax players.

One of the methods that these casinos can afford to use is charging a subscription fee. Some will provide weekly or monthly events that take a lot less effort and money to organize than live poker tournaments. They can also host a larger number of players as they aren’t restricted by physical space.

Some online casinos will offer rakebacks, which are a system that returns a portion of rakes to players. Rakebacks actually lose online casinos but are an excellent way to retain players. The casinos are hoping that poker players who stay on the site for a while eventually move on to more lucrative games like slots.

Rakebacks are calculated similarly to rakes themselves. Dealt rakebacks award each player equally, no matter how much they contributed to the pot. Contributed rakebacks are the opposite, with casinos returning money based on the wager the players make.

Players skilled enough to play in multiple poker rooms at once can use rakebacks to their advantage. Depending on how many hands they play, they can earn up to thousands of dollars per month, allowing them to minimize their losses.

Conclusion

In a sense, casinos have a love-hate relationship with Texas Hold’em. On the one hand, they’d prefer you to play anything else, where the house edge is higher, and the chance for profit is more significant. On the other, they can’t remove poker tables due to how many players enjoy it. Doing that would nearly guarantee that the casino runs out of business fairly quickly.

Over the years, casinos have adapted to the situation. They have learned to use poker, not as a huge moneymaker, but a powerful advertising tool. It’s no wonder we’re starting to see more hype generated around poker tournaments recently, and we doubt the marketing campaign is stopping anytime soon.

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