How Do Poker Rooms Make Money?

Most casino-style games pit the player against the house. When this occurs, the house makes a profit by keeping all the money that isn’t paid back as part of a win. Poker rooms would seem to work differently, however, as players are competing with one another instead of the house.

So how do poker rooms make money? That’s what this article is designed to uncover, so the next time you walk into a poker room or log-in online, you’ll know just where your money is going.

What Is a Poker Room?

This should be obvious, but I’ll go ahead and explain it for novices. A poker room is a place dedicated to the game of poker, whether it’s an online casino, brick-and-mortar establishment, or an underground gathering. In the case of casinos, anyone can enter and play. Underground establishments, on the other hand, require you to know a password to gain entry.

How Poker Rooms Make Money

The following are the most common ways that poker rooms make money. Rates will vary, of course, so don’t be shy about searching for the best deals. If everything else is equal, you should always go with the option that drains the least amount of your bankroll.

The Rake – This is the most common way for poker rooms to make a profit. An amount will be deducted from each pot and given to the poker room. Sometimes this will be a flat rate per pot, although the most common option is to charge a small percentage. In the latter case, the poker room will benefit more from larger pots, and it’s not unusual for underground games to bring in a ringer to keep the pots as large as possible.

Time Drop – This method charges the players a flat fee for the right to sit at the table. This is normally done when a new dealer enters the game, although it can also be charged at specific intervals (every half hour, for example). The amount may be as low as $3 per player, unless it happens to be a poker room for high rollers.

Cover Charge – In order to enter the poker room, the player must pay a fee. This method is becoming less common.

Tournament Fees – When a poker room holds a tournament, it will charge an entry fee and take a certain percentage of that money for the house. In the case of major tournaments, a poker room can also supplement their profits by charging merchandise vendors, television networks, and even the folks who are there to promote their products.
While knowing how poker rooms make money won’t lead to a winning streak, it’s helpful to know as much about the game as possible. Not only will you be able to converse intelligently with other players, but you’ll also be able to look for poker rooms that take in less of a rake or charge a lower admission fee. The more money you can save, the more cash you’ll have to wager at the tables.