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Online Poker FAQ - Online Poker Advisor

  1. Are my cards truly random? What is a random number generator?
  2. How do online poker rooms make money?
  3. If I win a lot of money will I get paid? Are the poker rooms financially sound?
  4. Is online poker just another form of online gambling?
  5. What are the advantages of playing online poker? How is online poker better than live games?
  6. What are the advantages of playing live poker games?
  7. What kind of computer do I need? What are the standard minimum system requirements?
  8. What happens if I get disconnected during a game?
  9. Should I be worried about player collusion?
  10. Is online poker legal?
  11. Who regulate and license the online poker rooms?
  12. Can I trust the online poker rooms?

#1 Are my cards truly random? What is a random number generator?

No human dealer can randomize cards as well as a computer can. Online poker rooms use random number generators to ensure the cards dealt never fall into any predictable pattern. The random number generator uses the same algorithms that power the SSL encryption technology. (SSL is the high security encryption technology used for online credit card and banking transactions.)

To add an extra layer of randomness into the mix, certain websites add additional entropic inputs from the physical world, such as rate of neutron emission from a radioactive substance.


#2 How do online poker rooms make money?

Like the poker rooms in Las Vegas and Atlantic City, online poker rooms collect a small percentage from each pot, known as the rake. In real life poker rooms, rakes range from 5-20% of each pot.

Generally the bigger real life poker rooms charge at least a 10% rake to cover the overhead costs (rent, dealer's salary, etc) and the various amenities they provide (free drinks, snacks, shows, etc).

Online poker rooms generally charge 5% in rake because they have relatively lower overhead expenses.


#3 If I win a lot of money will I get paid? Are the poker rooms financially sound?

When you play online poker, you are not playing against the house. All the money you win comes from other players. The online poker rooms have nothing at stake in any of the games—the rooms simply sell chips to players before the game, and distribute money to the winners after the game. Because online poker rooms do not lose money when you win, you will get paid even if you win millions of dollars.

For example, in 2004, Party Poker hosted a 3.8 million dollar poker tournament. Televised by the Travel Channel, the tournament broke the World Poker Tour's record for highest payouts in a single tournament. More importantly, Party Poker paid all the winners immediately, the most dramatic payout being the million dollar check presented to winner Eric Lindgren.


#4 Is online poker just another form of online gambling?

Online poker is not the same as online gambling. Casino games such as craps, slots, or roulette are games of chance, where the odds are stacked in the casino's favor. But when you play poker, you are playing against other players and not the casino. In poker, odds are the same for all players. What separate winners and loser is a matter of skill.

As Matt Damon said in Rounders, "Why do you think the same five guys make it to the final table of the World Series of Poker EVERY YEAR? What are they the luckiest guys in Las Vegas?"


#5 What are the advantages of playing online poker? How is online poker better than live games?

  • Lower rake and no tips - With virtually no overhead costs, online poker rooms have much lower rakes than real life poker rooms. Online poker room's rakes are usually capped at 5% of the pot. Las Vegas and Atlantic City poker rooms can charge as high as 10-15%.

    Tips for dealers and waitresses are another expense you have to pay when you play in live poker rooms. Generally you are expected to tip the dealers at least a dollar or two for each large pot you win. The lower cost of playing online definitely adds up in the long run, especially at the lower limit games.
  • More Hands per hour – Online poker rooms can deal out twice as many hands per hour as live poker rooms. Therefore, playing one hour of online poker is equivalent to playing two hours in a live game. The increased number of hands can double a good player's winnings. In a live game, a good player can expect to win one big bet per hour. With twice as much action online, a good player can win twice as much in the same period of time.
  • Play Multiple Tables – Not only can online poker rooms deal more hands per hour, they also offer players the option of playing multiple tables. A good player can play profitably on two tables, thus doubling their winnings per hour. While playing two tables can double your winnings, this does not mean playing four tables will quadruple your winnings. There is a limit to how much information your brain can process. Regardless of how good they are, a player's win rate will decline when they try to play more than four tables.
  • Wider selection of games – You can find any type of poker game online around the clock. In addition to popular poker games like Hold'em, Omaha, 7-Card Stud, and Draw poker, you will find other more obscure variations like Caribbean Stud, Panguingue, and Pineapple poker. You can play regular games, tournaments, heads up games, private games, or league games; you can play for free, for micro stakes as low as $.01/.02, or for millions of dollars.
  • Calculating pot odds and correct betting – When you play online poker, the poker software will tell you exactly how much money is in the pot, the amount other players are betting, and the maximum and minimum amount of bets you can make. For beginning players this is a relief, as they can learn the game without making embarrassing mistakes at a live table. For more advance players, they can utilize the information to make much more accurate pot odds calculations.
  • No dealer mistakes – Live poker dealers are human beings and they make mistakes like everyone else. Once in a while a human dealer will declare a wrong winner or muck the wrong cards. These mistakes never happen online.
  • Virtually no waiting time for Tables – The average waiting time for an online poker table is less than two minutes. At live card rooms, you could wait from 15 to 45 minutes for a table to open up.
  • Easier competition – Novices are intimidated to play live poker games because they are afraid of looking foolish in front of people. The anonymity of online poker attracts many first timers who are not familiar with even the most basic of poker strategies.
  • Bonuses – Due to their low overhead expenses, online poker rooms can afford to give away enticing bonuses for you to try out their websites. For more information, please see our bonuses section.
  • Play Money and Micro-limit games – Most online poker rooms offer free money games absolutely free of charge. These free money games use the exact same software interface as the real money games, thus giving beginners a realistic taste of the game. For beginning players, play money games is a great way to learn the basics. After a week of free games, a beginner can advance to micro-limit games, where only pennies are at stake.

#6 What are the advantages of playing live poker games?

  • Socializing with other players – Having fun with people is a big part of what poker is all about. Your weekly kitchen table game is where your friends gather to drink beer and shoot the bull. Online poker can never replace that.

    However, online poker rooms are a good place for meeting new people. All online poker rooms have chat boxes where you can talk to players from all over the world. Some of the newer rooms personalize the games by allowing players to supplement their avatar with their own images. Do not expect to make any lifelong friends however. While many players are friendly chatters, remember their primary goal is to win money.
  • The money seems more real – When you buy chips at a card room, you have to physically hand your cash over to the dealer; if you lose all your money, you have to walk back to the ATM to get more. These little details help remind you that you're playing with real money.

    Online, the chips are just numbers and pictures, and you can refill your chips with the click of a button. If a bad player goes on tilt, he can dig a pretty big hole for himself.
  • Reading your opponents –Your opponent's facial expression and body posture tells you a lot about what kind of hand he has. None of these physical "tells" are available to online poker players. However, there are other ways of finding non-physical tells during online play. For example, your opponent's betting pattern and betting speed are obvious tells if you know what to look for.

#7 What kind of computer do I need? What are the standard minimum system requirements?

Almost any Windows compatible computer purchased within the last four years will meet the requirements.

A typical system requirement for online poker rooms looks like this:

  • Windows 98, ME, 2000 or XP
  • 200MHz Pentium or faster CPU
  • At least 64MB of RAM
  • At least 20MB of free disk space

Generally, Macintosh and Linux computers are less widely supported. However, some poker software do support Macs or Linux machines running PC emulators such either SoftWindows or VirtualPC. For more information on Mac/Linux support, please refer to our article "Finding the Right Poker Room" in our Online Poker Room Review section.


#8 What happens if I get disconnected during a game?

Most online poker rooms have identical disconnection policies. Generally, if a player gets disconnected from the internet in the middle of a hand, he is given 20 seconds to rejoin the game. If the player does not return before the hand is finished, he is still eligible for the portion of the pot to which he has contributed. The remaining players can continue betting in the hand, while a special side pot has been set aside for the disconnected player. If the disconnected player ends up having the best hand, he will win the side pot to which he has contributed.

In the unlikely event of a game server crash, all games are cancelled and all chips at the table and in play will be refunded to players.


#9 Should I be worried about player collusion?

Collusion occurs in both online and real life games. Fortunately it is much easier to detect online collusion. Online poker rooms analyze each hand history with sophisticated algorithms to detect suspicious betting patterns and player interactions. Moreover, online poker rooms also monitor IP address to ensure people from the same location do not play at the same table.

Many of the classic poker cheats used in live games do not work well online. A good example is "chip dumping"—the practice where one player intentionally loses his chips to his partner during a tournament. In a live game, chip dumping is impossible to detect once the loser mucks his hand. By the time you complain to the pit boss, the dealer has already shuffled the cards, erasing all evidence of the chip dump.

It is a different story online. Every single hand, even the mucked hands, are recorded and analyzed by security algorithms. If two players have a pattern of making ridiculously bad bets against each other during tournament play, the computer will detect it.


#10 Is online poker legal?

Online gambling is explicitly legalized and regulated in countries like Great Britain, Costa Rica, and Antigua. In the United States however, the legality of internet poker rooms, like many other legal aspects of cyberspace, remains unclear.

"The federal government's interest in gambling is pretty much limited to organized crime" wrote Professor I. Nelson Rose*, a leading legal authority in the gaming industry.

According to Professor Rose, "a regular player cannot get into trouble with the federal government even if the gambling operation is blatantly illegal unless he does something to help the business."

"Prosecutors have charged players with being part of the gambling business when they helped operators collect debts from other players. But the very few times the federal Department of Justice has gone after regular players, judges have thrown the cases out."

Recent case law seem to support Professor Rose's view. In 2002, the Fifth U.S. Circuit Court of Appeals upheld a district court's dismissal of a lawsuit by gamblers Larry Thompson and Lawrence Bradley, holding that the gamblers failed to prove that online casinos and the credit card companies they used to process their wagers violated federal racketeering laws and the federal Wire Act.

The Fifth Circuit upheld the lower court's ruling that "internet gambling in connection with activities other than sports betting is not illegal under federal law." As the court explained, "recent legislative history of internet gambling legislation reinforces the Court's determination that internet gambling on a game of chance is not prohibited conduct under 18 U.S.C. §1084." (read the entire opinion)

On the international front, the World Trade Organization recently ruled that U.S. prohibition against online gambling violates international trade agreements. The ruling was in response to Antigua's complaint that America's prohibition against internet gambling has financially harmed Antigua's burgeoning internet gaming industry.

"We lost many jobs as a result of the U.S. laws," said Sir Ronald Sanders, Antigua's ambassador to the WTO. "This is justice done and a victory for the WTO dispute system. This proves that a small country like ours can take on a big nation and win."

The immediate impact of the WTO ruling is unclear. "The U.S. is under an obligation to repeal their laws," Sanders said. "But they will probably appeal and delay for as long as possible."

* Professor Rose is a gaming law advisor to state and national governments, including Arizona, California, Florida, New Jersey, Texas, and the federal governments of Canada and the United States. Professor Rose is the author of more than 300 books, articles, book chapters and columns. He is best known for his internationally syndicated column, "Gambling and the Law."

Disclaimer: Online Poker Advisor is not a legal authority of any kind. The information provided in this FAQ is gathered from various news resources and law review articles. We make no representation or warranties regarding the accuracy of this information nor should this information be considered legal advice. Please consult the laws of your jurisdiction before playing.


#11 Who regulate and license the online poker rooms?

More than 50 governments worldwide license or regulate online gambling. Some of the more prominent gaming jurisdictions include Great Britain, Australia, New Zealand, Sweden, Germany, South Africa, and Native American nations.

One of the most respected regulatory jurisdictions is the Kahnawake Mohawk Nation. Located just outside of Montreal, Kahnawake is a sovereign nation whose right to self-government is recognized by the Canadian federal government.

Kahnawake's Gaming Commission (KGC) drafted its gaming regulations with the guidance of Frank Catania, the former director of the New Jersey Division of Gaming Enforcement. Due to his influence, KGC's regulations adhere to the same strict standards employed by gaming commissions of New Jersey, Nevada, and Michigan.

As Catania observed in his report, "Gaming Regulation: The Kahnawake Experience":

"The Mohawks have established a regulatory scheme to protect people that participate in gaming entertainment over the Internet. This protection is achieved by assuring players that operators licensed by the KGC have passed a strict suitability investigation, including a financial check to assure that the operator has the resources to pay winning bets, and a technology check to ensure that the games are fair and honest. The Kahnawake Mohawks have taken the lead regulating Internet gaming."

The KGC uses two independent entities to ensure its regulations are being followed: The National Fraud Center and BBM Test Labs.

The National Fraud Center has over 30 years of criminal, regulatory and civil experience in the gaming industry and its experts have given expert testimony before the New Jersey Casino Control Commission as well as the President's Commission on Organized Crime in the Casino Industry.

BMM Test Labs is an accredited testing facility with over 23 years of auditing and regulatory experience. BMM provides auditing and verifications services for government-sponsored gaming institutions such as the Arizona Lottery Commission, Michigan Gaming Control Board, Montana Department of Justice, and National Gambling Board of South Africa.


#12 Can I trust the online poker rooms?

There are over 450 poker rooms on the internet and not all of them deserve your trust. Like any other industry, there are good apples and bad ones. The key to finding a trustworthy online poker room is making sure that the online poker room is regulated by independent auditors.

For example, the integrity of Paradise Poker's games are independently audited by one of the top four accounting firms in the world. Conducted on a quarterly basis, these independent audits involve rigorous statistical tests that ensure the fairness of the games and the randomness of the cards.

The top independent auditor in the online poker industry is BMM Test Labs. BMM is an accredited testing facility with over 23 years of auditing and regulatory experience.

BMM provides auditing and verifications services for government-sponsored gaming institutions such as the Arizona Lottery Commission, Michigan Gaming Control Board, Montana Department of Justice, and National Gambling Board of South Africa. The top online poker websites regulated by BMM include Party Poker, Empire Poker, and Poker Stars.

The best online poker rooms welcome strict independent auditing because they can only make money if their players feel secure. Stay away from online poker rooms that do not disclose their independent auditing procedures. For in-depth analysis of each online poker room's integrity, please visit our online poker room review section.



 

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