Payout Structure Debate

The debate on tournament payout structure continues. One side basically wants to flatten the payout structure in a manner in which no "deals" will be necessary, and the other side prefers a larger first prize (which has been pretty standard in poker tournaments for 20 years).

For those who may not know, deals often take place near the end of a tournament. They occur when two or more players arrange a restructuring of the prize money in a way that is different from what is posted. Simply stated, they split or divide the prize money more equitably. In larger events, the variance of prize money at the top is such that most tournaments end in a deal.

The only way to flatten the payouts is to take money off the top. Those who are against doing this like the idea of going for the gusto and making a score if they are fortunate enough to win. With a big first prize, they claim that players still have the option of making a deal and splitting the money more evenly if they so desire, but they think it should be a choice and not a requirement.

In Paris recently (during the Euro Finals of Poker), this issue was a topic of lively conversation. I happened to be at dinner with a leading advocate on each side of this debate. In one corner was Barry Shulman (owner of Card Player), and in the other corner, T.J. Cloutier (the most successful tournament player in history.)

Shulman is for a payout structure that is gradual because he is opposed to deals. It's not that he personally opposes them, it's that he is concerned with the negative image that deals portray to a viewing audience and potential sponsors. Barry thinks that a flatter payout structure and a "no deals" policy would help curb the conspiracy and collusion fears that some now associate with tournaments.

Cloutier thinks that people play tournaments to make a score, and if you win one (which even he admitted was very tough to do), you should be paid handsomely. A good point he made was that there's a huge difference between local tournaments and large tournaments (for which the majority of players must travel). For the large events, he pointed out how much it takes in travel costs and entry fees, and thinks that bigger payoffs are needed to meet expenses. He thinks smaller tournaments should spread the money out, but that players go to the big events to make a score that could change their lives.

T.J. also thinks the lure of the big prize (the "pot of gold") is what attracts players to an event in the first place, and that reducing it would result in fewer entrants. He thinks the "top end" payout structure still gives players the opportunity to make a deal and split the money more evenly if they so desire, but it also gives them a chance to go for the big score. It's their money, and it should be their choice. Finally, T.J. said, "If it ain't broke, don't fix it."

Naturally, both of these guys are arguing for their own interests. Barry owns the leading voice in the poker world and wants tournaments to thrive without dealmaking controversy. By spreading the money out, there will be no deals, thus a cleaner image for poker, and more players will stay in action and play more tournaments, all of which are good things.

Although they may not admit it, the top players (which certainly includes T.J.) prefer the higher payout structure because they figure to win more than most. In addition, if they do make a deal, they figure to get the best of it based on reputation and past performance.

Those in favor of a "no deals" policy usually say, "Until we have a no deals policy, sponsors won't get involved in poker. Therefore, we should ban all deals now." I don't agree with that. To me, this is like saying, "Which comes first, the chicken or the egg?" I believe that until sponsors get involved, and as long as the prize pool is the players' money (and no best all-around prizes are affected), players should be able to do what they want to do with their money.

Once sponsors become involved in tournament poker, I am certain that deals will not be a problem. Players will appreciate having sponsors and will honor a "no deal" policy. (We instituted a "no deal" policy at the origin of the Tournament of Champions because we anticipated sponsorship, and in two years, there has not been one violation or even one complaint about it. Players respect it. I am certain they will have no problem abiding by a "no deal" policy if the prize pool in any tournament is supplemented by sponsor money.)

Not lowering the prize money at the top (which is what must happen to flatten the payout structure) has its advantages. First, players like to go for the "pot of gold." (Just look at the two largest attendance increases in World Series of Poker history. The first occurred when they guaranteed a $1 million first prize, and the second took place last year when they guaranteed a $1.5 million first prize.) Second, those who wish to make a deal and distribute the money in a more equitable fashion may still do so. And third, the casinos hosting tournaments like to advertise larger payouts for promotional purposes.

I do like the idea of tournaments continuing uninterrupted to their conclusion without having to talk about deals. On the other hand, I also like going for the "pot of gold." The debate continues.

Take care.

Mike Sexton can be reached by E-mail at: [email protected].