1. How Do Casinos Make Money Off Poker Tournaments
2. How Do Casinos Make Money On Poker Tournaments

Most poker rooms lose money off poker tournaments that's why they are so fast.like $25 buy in $3 entry fee with 20 min rounds. And are over in about 2 hours or less.becasue the blinds get so high so fast.they are just there to draw players in.in hopes they stick around for the 'live' game after they get busted out OR take their. Casinos are a business and there to make money so all the money you see on the casino floor goes to the running of the casinos and the investors. A bit goes to pay off the machines and games to. One of the main ways that a brick and mortar casino will make money from poker is through what’s called the rake. The rake is essentially a commission taken by the casino based on the pot. This can run anywhere between 2.5 to 10% in some cases, and compensates the casino for hosting the game.

Here is how casinos can make money on hosting poker games.

We all know that poker players can make money if they playwell enough. They play against others and they all invest their own money inanteing up and growing the pot until someone comes out victorious. Then theyrepeat the process all over again. But how do casinos make their money if theplayers are simply betting against each other? There are a couple of ways, andit depends on how the game is being played, and where it is being paid.

One of the main ways that a brick and mortar casino willmake money from poker is through what’s called the rake. The rake isessentially a commission taken by the casino based on the pot. This can runanywhere between 2.5 to 10% in some cases, and compensates the casino forhosting the game. They may also charge a fee for time spent sitting at thetable. These are usually charged by the half-hour.

However, in some casinos, the poker tables are consideredloss leaders. They know that poker is incredibly popular so they draw peoplein. Demographics show that poker is primarily played by men, and slots bywomen. The thinking is that by drawing men in to play poker, their wives andgirlfriends will play slots. Slots are incredibly popular for casinos, so theydo whatever they can to get people playing them. So while these casinos mightnot be making money directly from poker, they are still making money indirectlyfrom having it available on site.

As for online poker, there is a similar concept. The site may take a rake when you play poker online, or it may charge a fee for sitting at a table. Many sites also profit from advertisements, partnerships, and sponsorships, so the more people they have playing games the higher their ad rates can be. They also charge participants for tournament play. For instance, the buy-in for a tournament may be listed as $100 + $10. This means that $100 will go into your bankroll for the tournament, and $10 will go to the site.

As you can see, there are several ways that casinos andpoker websites can profit off of poker. It is an incredibly popular game,whether people play for stakes or just for fun. Casinos operate for profit,however, so they will do whatever they can, as long as it’s legal, to make asmuch as they can.

They take a rate(a portion of each pot).....Like at a 3/6 table they will rate $3 from every pot.....progressively as the pot grows....for a max of $3 once the pot gets over $20...but different poker rooms have different rules as to how much the rack is and how it is progressively pulled out as the pot grows...

A $3 rake will be more common in Las Vegas; outside of competitive markets for poker (i.e. Vegas, California), the rake is usually at LEAST $4 (i.e. Missouri), but most places now in the Midwest are up to $5, with the highest being $6 in Detroit. That's the max rake, with 10% taken out if the pot is less than 40, 50 or 60 dollars respectively.
The other practice that gets me at some casinos is the rake before a flop. This is by law in West Virginia... what I mean is, say a player raises to $10, and another player raises to $40, the initial raiser goes all in to $200, causing the other to fold. The pot has 3+1+10+40=$54 before seeing a flop... in WV and Hollywood Casino in IN they rake $5 + $1 for the bad beat on that!!! And you didn't even see a flop.

On the flip side you need to keep those tables full.....and you need 15 or so dealers to service 10 tables....that's why a lot of casinos pay prop players to play so games doesn't break down...

I have never heard of prop players in use in any Midwest casinos. I know the casinos in Tunica used to do that, but I think even that's been limited.

Most poker rooms lose money off poker tournaments that's why they are so fast...like $25 buy in $3 entry fee with 20 min rounds.. and are over in about 2 hours or less...becasue the blinds get so high so fast.....they are just there to draw players in...in hopes they stick around for the 'live' game after they get busted out OR take their winnings to the 'live' game...or to another table game or slots.....

This is also no longer true in the Midwest. Casinos actually make a TON of money on tournaments now. Reason being, they bump the fees up to a ridiculous amount. Most tournaments here have a $10 fee for anything less than $100 buy-in, and up to $25 for more than that. Caesars properties has made an art of bilking the player for money in tournament fees. They have tournaments where players get paid less than 60% of what the true buy-in (fees + buy-ins) are.
Part of it is a public relations thing, but casinos around here can't open a poker room fast enough if they don't have one. Unfortunately, some 'markets' have one or two big dogs, and the smaller ones can't be profitable. The competition goes away for a while, then the big dogs get greedy. Players demand that the smaller casinos reopen their rooms, and the competition comes back, albeit not as good as before they left.

I'm not at all familiar with poker rooms or poker room operations but I have seen some ads for poker room prizes that start at a certain amount and climb. I assumed that starting amount was casino seed money and that the escalation was from a rake. As I understand it some of those bad beat jackpots grow to such figures that alot of players keep playing in the hopes that they will be there to qualify for a share of some jackpot distribution.

You're probably talking about Bad Beat jackpots. Because BOTH hands must have pocket pairs for quads, or use both cards for a SF, and the minimum hand is typically quads, the jackpot sometimes doesn't hit for months and can grow quite large.
Typically, the casino takes an extra $1 out of any pot over $20. Only hands where the pot is at least $20 qualify. At the end of the day, those dollars are added to the current jackpot prize.
That prize is typically divided as: Of the total prize posted, 50% goes to the 'loser' of the bad beat. 25% to the winner. 25% divided amongst the other players at the table. Some casinos divide the remainder amoung all players in the room. The four Caesars properties in AC are linked so that the remainder is divided amoung all players in all 4 rooms.
Note that the prize posted is only 80% of the total collected. 20% held in reserve to reseed the Bad Beat.
When a casino initially introduces the bad beat jackpot, they will fund it with about $20,000. While that's their own money, they are not really being generous. A small portion of the daily contribution is taken to repay the casino for the initial seed, until repaid. If the 20% in reserve be below that threshold, the casino will top it off, and again take a small portion.
Some casinos have a different type of jackpot. Mohegan Sun in CT does a High Hand every 4 hours. For 3 hours, they take $1 out of pots of over $20, and record and announce the highest qualifying hand. During the 4th hour, they empty the buckets, count the chips and award the prize. The qualifier announcements generally starts as 'quad __ with __ kicker.' Before it's done, the qualifier is usual 'SF __ high', and is often escalates to a Royal. Ties split the pot.
Last Christmas morning, with very few players in the room, and about 45 minutes to go, I qualified with quad sixes. Because there were so few players, I had high hopes. But with about 5 minutes remaining, I got beat. Sigh.
On the original subject, the casino takes, usually, 10% of the pot, for a maximum of, typically, $4. Some take $5. Some take as little as $3. If you read my review of Royal Caribbean Cruise, they take a maximum of $15. On the cruise, more than once we heard the phrase, 'Don't like it? Go to the casino next door.'

I've never played in one so I may be missing an obvious facet of playing Texas Hold'em, but where does the casino make money for hosting players for hours on end? Drink service? Entry fee? House commission?

In Ohio, we don't have casinos (yet, they are on the horizon). However, there is a law that allows card rooms to exist as clubs. In these cases, the 'house' charges a membership fee and then a 'daily use fee.' These are a bit higher on the front end, but then they don't rake the pot. (Most clubs are now taking a $1 or $2 out for a bad beat jackpot/jackpot hand scenario.) There were a couple clubs that did actually rake, instead of charging a fee, but that's illegal, and I think those operations get shut down by other card room owners trying to skim the competition.
It's a lot less seedy than it sounds. They are usually in strip malls near 'games of skill' slot parlors or internet cafes, although a few exist in nicer venues. These are legit games, and if you play a lot, it's much cheaper in the long run than having a rake taken out. There are three or four 'big' clubs that usually have at least 3 games going, then a bunch of medium sized clubs that have one or two sometimes going on. The places pop up for a while then disappear without any warning (except for the big ones; they have loyal followings and are usually the best run anyways).
The other caveat is that dealers are not considered employees, but rather volunteers. The players cannot pay them in actual money, so you buy 'chocolate chips' which are brown $1 chips to be cashed by employees only. Some clubs have put those on the table for the dealer to convert, while others require you buy them at the cage. The only club employees then are security and managers, limiting overhead.

On the original subject, the casino takes, usually, 10% of the pot, for a maximum of, typically, $4. Some take $5. Some take as little as $3. If you read my review of Royal Caribbean Cruise, they take a maximum of $15. On the cruise, more than once we heard the phrase, 'Don't like it? Go to the casino next door.'

I'm not a cruise person so I didn't read that particular article, sorry...
I'm guessing you had to file a police report after getting off the cruise if you were playing poker... that's an open and shut case of RAPE!!

On the cruise, more than once we heard the phrase, 'Don't like it? Go to the casino next door.'

I should point out that the phrase was jokingly said by a player, not the staff.

I'm not a cruise person so I didn't read that particular article, sorry...

I understand completely. For what it's worth, I'm 52, and this was my first cruise. Before I sailed, I didn't think I was a cruise person either. Now I'm anxious to go again.
For what it's worth, I went into detail about the ship's casino in this post.

For what it's worth, I went into detail about the ship's casino in this post.

Actually in the meantime, I did find your review of the poker room on the cruise thread. I find it hysterical that they used an empty BJ table for poker. I'm guessing the rakes REALLY got screwed up on that table, as the dealer probably wasn't thinking that far ahead.
Depending on how it was dealt, I probably would have turned over an A-Face immediately, expecting to get paid 3:2.

How Do Casinos Make Money Off Poker Tournaments

I've never played in one so I may be missing an obvious facet of playing Texas Hold'em, but where does the casino make money for hosting players for hours on end? Drink service? Entry fee? House commission?

How Do Casinos Make Money On Poker Tournaments

Out of 251 casinos in Nevada last year that made a minimum of $1 million in gaming revenue for the year all of them had slots, 155 had pit games, 99 had race and/or sports betting, and 94 had poker.
For smaller casinos poker only collects enough money from the rake to pay for the cost of the poker room and the dealers. The casino is hoping that these players will stick around and play more profitable games. Sometimes friends accompany the poker player and play slots or pit games. So it is basically a loss leader.
Poker brings in 1.6% of the total gaming revenue for NV, sports brings in 1.4%, and race book brings in 0.7%. So in general you can probably refer to them collectively as means to attract people into the casinos. There are some exceptions, casinos that do make a bigger profit on poker.