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Is Poker a Game of Skill or Chance?

23. 2. 2012. This question is highly up-to-date at the present time as some countries for various reasons try to restrict or even ban poker, claiming that is a gambling game or a game of chance. The popularity of poker has been growing rapidly and its followers, especially the professionals, are united that it is a game of skill. Let us try to figure out the answer.

Definition of Poker in the World

The last year (2011) a French court made many poker players around the world happy as it issued a ruling that poker is a game of skill. The court was convinced by the testimonies of professional poker players, mathematicians, chess players and others.

The dispute, whether poker is a game of skill or of chance, was brought about at the Swedish Supreme Court as well. The ruling was ingenious. According to the court the game of poker comprises both skill and chance (or luck). Additionally it depends on the concrete poker game and how long it is played.

This debate is currently hot in the Czech Republic with the new lottery act effective from 1 January 2012. However it has not been solved at a court level yet. According to the new legislation poker is considered to be a game of chance—this is very likely a result of domestic interest groups— with serious practical impacts.

The poker play (or tournaments) can only be organized by state-licensed entities. However they are required to have a 100 mil. CZK initial capital (approx. 4 mil. euros), which is unreachable for the majority of smaller poker organizers.

Therefore the Czech Poker Association organized a provocative tournament for about 40–50 players right on 1 January 2012 with the buy-in 1 CZK (5 cents). The deputies of the Czech Ministry of Finance were present and administrative proceedings are to be initiated.

The first fine imposed on poker tournament organizers in the Czech Republic (2012-05-31).

The Czech Poker Association argues and is ready to prove that poker is more of a sport and a game of skill rather than a strict game of chance. Moreover it is now (since 1 Jan 2012) illegal for Czech poker players to play online on the poker servers of foreign betting companies.

The new lottery act is quite controversial as the foreign companies cannot carry on their online business in the Czech Republic as well as they cannot even obtain the license. They would have to establish a stone branch in the Czech Republic. This is certainly against EU free trade and services legislation since the Czech Republic is a member of EU and (most of) the foreign betting companies are registered in some other EU countries (such as Malta).

Comparison of Poker and Chess

In the Czech case the followers of poker as a game of skill seek arguments aiming at excluding poker from the force of the new lottery act. They try to compare poker to chess, which is considered a sport. As I personally play chess actively at a league level, I will try to compare these two games.

There is no doubt that poker is a game of skill and strategy, however with some elements of chance. The proportion skill vs. chance vary based on the skill of each individual player. In the short run an outsider may be lucky and kick out Pius Heinz or Martin Staszko (WSOP 2011 final). But in the long run good players win, bad players lose and it is not coincidence. Poker is a multidisciplinary game, whereas a player may use their knowledge of math, statistics and probability, but also psychology.

The good players know that if they make decisions with a positive expected value, their balance (or success) will also be positive in the long-term period. Moreover the more they know their opponents, the better decisions they can make. Each poker player has some playing style or tends to it. Some players play only strong hands (tight players), some of them are able to play with weaker hands (loose players), the others may fold frequently if a bet is raised etc. Even though the player tries to change his style of play, the long-term statistics may reveal it in some way and the best players are able to work with them.

→ See how good or bad luck in Poker can be measured by the $ EV Adjusted and
Variance explained by a simple example.

Although I am a supporter of poker and the struggle to legalize it, I believe that comparison of poker to chess is a bit unfortunate. Chess is a sport with long tradition (however this is not the reason). I might also add that some believe that sport can only be a physical activity (only chess players can tell how tiring they are after a classic game of chess that can take up to 6 hours...).

In chess you have got the same initial positions; nobody can "shuffle" a better position or material advantage for you. An amateur can hardly beat a chess world champion or even better – the best chess engine that plays almost flawlessly and does not give you a chance of success. Unlike that in poker if you are dealt a good hand (or if you have an extraordinary good poker day), you may beat anybody. That is the main difference.

Poker and Stocks

It comes much more interesting to me to compare a poker player to a trader who buys stocks and, as well, does not know the result in advance. There is just a good probability that a good trader will make some extra money (as well as there is a good probability that a good poker player will be winning).

However sometimes a bit of luck is necessary, because the trader is not able to cope with or influence all aspects that determine the price of the stocks. On the contrary he might be unlucky and lose some money, while a trader-beginner can be successful. But in the long run the good trader (as well as the good player) will be in the black.

After all it is shame that we have to deal with this debate, whether poker is a game of skill or chance and its legal implications. The governments try to protect us from gambling. I feel it is an attempt to limit personal freedom rather than a protection. More often it is a protection of state lottery monopolies. It is sad that poker players are banned from playing e.g. $1 poker tournaments at home, not threatening anybody even themselves. What do you think?

Bankroll Management
Final hand analysis Heinz-Staszko (WSOP 2011 final)
Last hand in Casino Royale (2006)