A Mismatch Between Wikimedia's Pledge Drive and Its Cash On Hand?

Andreas Kolbe writes The latest financial statements for the Wikimedia Foundation, the charity behind Wikipedia, show it has assets of $60 million, including $27 million in cash and cash equivalents, and $23 million in investments. Yet its aggressive banner ads suggest disaster may be imminent if people don't donate and imply that Wikipedia may be forced to run commercial advertising to survive. Jimmy Wales counters complaints by saying the Foundation are merely prudent in ensuring they always have a reserve equal to one year's spending, but the fact is that Wikimedia spending has increased by 1,000 percent in the course of a few years. And by a process of circular logic, as spending increases, so the reserve has to increase, meaning that donors are asked to donate millions more each year. Unlike the suggestion made by the fundraising banners, most of these budget increases have nothing to do with keeping Wikipedia online and ad-free, and nothing to do with generating and curating Wikipedia content, a task that is handled entirely by the unpaid volunteer base. The skyrocketing budget increases are instead the result of a massive expansion of paid software engineering staff at the Foundation – whose work in recent years has been heavily criticised by the unpaid volunteer base. The aggressive fundraising banners too are controversial within the Wikimedia community itself.

Comments

Well

[war4peace]

I always thought that transparency should be right there in the banner. "Hey guys, we have 60M worth of assets but we need more because $REASON".

Re:Well

[fibonacci8]

So just tag the banners with [Citation Needed]?

Re:Well

[JMJimmy]

I always thought that transparency should be right there in the banner. "Hey guys, we have 60M worth of assets but we need more because $REASON".

The reason is simple, they over pay their staff significantly. Even for being in silicon valley which is about 29% higher salaries they fail to understand they are a non-profit. Over 20% of WMF staff get paid over $100,000 per year. The executive director makes over $200,000 while the median salary for a non-profit executive director in the US is closer to $60,000.

Re:Well

[Anonymous Coward]

In California, you'll find a lot of people making over $100,000. It is just a high cost of living, coupled with what a "good" job pays. I'm a Solutions Architect in IT in CA., and I get just over $200,000. I'm not executive director or anything so high-falutin'. These are pretty normal salaries in good / very good jobs. (I'm not saying Walmart workers get $100,000 in CA.)

Re:Well

[TheRaven64]

Sounds like a good reason for money-conscious non-profits to hire people outside of California...

Re:Well

[JMJimmy]

Most of them are management or lawyers, not devs.

Re:Well

[Hussman32]

Non-profit corporations are not allowed to give equity to their employees, and that automatically keeps them at a compensation level below private corporations. If you want talent that can sustain the number 6 site in the world, you'll need to hire them where they are (in CA) and pay them commensurate to the industry practices.

$200,000 is not a lot for an Executive Director, and $100K is needed for a 'good' programmer here.

You can suggest that they move, but why? There is infrastructure and access to local contractors that you wouldn't have anywhere else.

I don't begrudge Wikipedia for making a few bucks, and I will still pay my $5 a year based on how much I use the site.

Re:Well

[TheRaven64]

Nonsense. There are lots of competent people all across the world. Unless you need a hundred or so people in the same office, there's no reason to be offering California salaries. The FreeBSD Foundation has contracted a lot of work to people in the Ukraine this year for that reason: they're competent, but not too expensive.

I believe forking it is still possible

[HBI]

That's the usual method of solving these problems. Wonder why no one is trying to do that if the fundraising is so controversial?

I understand but I also don't

[i kan reed]

Big software projects need developers. Full time, accountable ones with a paycheck and an office. Mozilla feeds theirs with ad revenue, Linux has some corporate supporters who pay the bills.

MediaWiki, that drives Wikipedia, is really complex. And they need new features to support the site better, especially admin tools and backend tech.

But, at the same time, screaming in desperation when you're doing okay and just need support for your functionality means that when you are in trouble, no one can tell.

I don't think you know what that word means

[sribe]

There is nothing "circular" about higher expenses leading to a need for higher reserves. It would only be circular if in turn the higher reserves led to higher expenses, which is not a point that you have made at all.

Re: I don't think you know what that word means

[bill_mcgonigle]

It's hate posts like TFS that reassure me that Wikipedia is being well-managed. The best he can come up with is "look at this evil financial prudence!"

Re:I don't think you know what that word means

[kruach aum]

If the submitter knew what circular logic meant, we'd have to ask ourselves why we allow submissions from people who knowingly spread untruths.

It is also in no way established that more donations is the reason spending has been increased. You can claim it's obvious all you want, but luckily reality doesn't conform to what seems obvious to its inhabitants. If it did, we'd be living on a flat disk with the burning chariot of a sun god running around it.

You're still doing that?

[t4eXanadu]

They still show those scary WIkipedia-is-doomed-without-your-help banners? LOL. I use Wikiwand now, so I don't see those anymore. What I disliked most about those banners is that once you donate, they don't go away. They keep hounding you for money! As part of my reward for donating, I shouldn't have to have your pledge drive shoved down my throat anymore.

Re:You're still doing that?

[Andreas Kolbe]

Wikiwand is one of those engineering shops they are scared of, because WikiWand have been doing better work than their own programmers, and are presenting Wikipedia content in a prettier format. And if people migrate to Wikiwand, then as you rightly say, people don't see their fundraising banners.

Their new VP of Engineering, Damon Sicore (ex-Mozilla), spelt that fear out. According to Sicore, the WMF will have to “scale to a size that enables us to compete with the engineering shops that are trying to kill us. That means we need to double down on recruiting top talent, and steal the engineers from the sources they use because well they are REALLY GOOD. ... I want everyone to keep this in mind: If we don’t move faster and better than google, apple, and microsoft (and their ilk and kin), they will consume us and we will go away. It’s that simple.”

Note well that what he's talking about going away there is the Wikimedia Foundation, not Wikipedia. The Wikipedia volunteers work for nothing; they are not reliant on donation money. And Wikipedia itself is also free, meaning it can be hosted by WikiWand, Google or anyone else who thinks they can present the content better than WMF. And if they managed to improve the content at the same time ... As I see it, this is what this expansion is about, not about keeping Wikipedia online and ad-free. And that's not what they're telling the public.

It is working for them, though...

[damn_registrars]

Wikipedia is still a very usable web site. By comparison slashdot went commercial some time ago and has become less usable with each passing year. Similarly while the content on wikipedia has continued to improve, the content here has continued to get worse.

Someone could learn something here, I'm pretty sure.

Spending too much, reserves good, SW improves cont

[raymorris]

> Wikimedia spending has increased by 1,000 percent in the course of a few years.

That could be a problem.

> Jimmy Wales counters complaints by saying the Foundation are merely prudent in ensuring they always have a reserve equal to one year's spending

Yes, a one year reserve on the low end of normal. You don't want Wikipedia to disappear when something bad happens, and SHIT HAPPENS. It's a top 10 web site, meaning it's in the big leagues with Google, Microsoft etc., except it's nonprofit. They may have to deal with stuff like Google is dealing with in Europe - disputes with multiple governments on the other side. You don't want Wikipedia to go bankrupt when some government or some company somewhere doe something stupid that costs the foundation $5 million to deal with and repair the damage.

> nothing to do with generating and curating Wikipedia content, a task that is handled entirely by the unpaid volunteer base.'

False. A large chunk of the budget is developing software for "generating and curating Wikipedia content". It's disingenuous to claim that developing tools for generating and curating content "have nothing to do" with generating and curating content.

Re:Spending too much, reserves good, SW improves c

[sandytaru]

An example of what they've done would be the recent Monuments project. They built a back end, complete with a Google maps API interface, to tell you exactly where they needed photos of which historic monuments, in relation to a given ZIP code. Based on that, I learned there was 200 year old farm house about a half a mile from my office, and I spent a productive lunch break driving over there and photographing it. Their website handled the upload, licensing, and then distributed the new photo to the Commons as well as the Monuments project. There were no errors during this entire process which means the entire thing was rigorously tested and properly coded. It was a painless user experience, if a bit dry because of the spartan aesthetics of Wikimedia, but my "generated content" was incorporated seamlessly into their project in about five minutes. That's good website engineering.

Not sure there's a problem...

[nine-times]

...but the fact is that Wikimedia spending has increased by 1,000 percent in the course of a few years... most of these budget increases have nothing to do with keeping Wikipedia online and ad-free, and nothing to do with generating and curating Wikipedia content...The skyrocketing budget increases are instead the result of a massive expansion of paid software engineering staff...

So from this information alone, I'm not sure I see the problem. You have a very large website that I'm sure gets unimaginable amounts of traffic, operating for free and supported by voluntary donations, and their budget is increasing because they've hired engineers to keep the thing running. That all sounds reasonable enough.

I think if you want to raise a red flag here, you have to show that the software engineering staff is unwarranted, or that they're working on things that the donors don't want to see done. So how many engineers do they have, and what are they working on? It seems to me that they're doing a competent job, since you have a relatively large, complex, and popular website that doesn't seem to have a lot of serious technical trouble, as far as I can tell. I'm sure they've had to scale up their capabilities over recent years, which requires some development in making the site scale and handle large, sudden increases in traffic. It looks to me like they're doing more than just maintain the Wikipedia-- they have the Wiktionary, Wikiquote, something called "Wikidata", and a bunch of other projects that all seem like they're probably legitimate, even if I don't know what they are. In that context, I can imagine them needing to keep a fair number of engineers on staff.

So what's the complaint here? Do you think someone is embezzling money, or that they're just stockpiling money for no reason? Do you think that they're spending money in the wrong places, and if so, where you do think they're spending money, and where do you think they should be spending money? I think you need to give me something before I can figure out how to be outraged at all of this.

Re:Not sure there's a problem...

[rudy_wayne]

So from this information alone, I'm not sure I see the problem.

    You have a very large website that I'm sure gets unimaginable amounts of traffic, operating for free and supported by voluntary donations, and their budget is increasing because they've hired engineers to keep the thing running. That all sounds reasonable enough.

So what's the complaint here? Do you think someone is embezzling money, or that they're just stockpiling money for no reason? Do you think that they're spending money in the wrong places, and if so, where you do think they're spending money, and where do you think they should be spending money? I think you need to give me something before I can figure out how to be outraged at all of this.

That's because this is Slashdot and you haven't bothered to actually read TFA.

Improving Wikipedia’s content is not really in the budget. Nearly $20 million goes toward salaries and wages, despite the fact that none of the staff edit Wikipedia as part of their job function. Almost $6 million was spent last year on awards and grants which certainly help produce some content for Wikipedia,but the writers are not typically compensated with anything more than pizza, sandwiches, and soft drinks.

Less than 6% of the WMF budget is spent on Internet hosting even though most people probably believe it’s their biggest expense. Meanwhile, they spend almost as much money (about $2 million) on travel and conferences. There is also a huge bucket for “other operating expenses” totaling nearly $12.5 million — some of which certainly pays for expensive downtown office space in San Francisco.

The WMF staff busy themselves on things that rarely have anything to do with writing, organizing, or exercising editorial discretion over the actual written product of Wikipedia. Instead, the WMF now considers itself a software and technology organization, but ends up doing more harm than good with its software "innovations". The last two software roll-outs — Visual Editor and Media Viewer — were loathed by a wide swath of users. The WMF responded to the community’s rejection of its software by literally forcing it back on the community with a tool called “superprotect”.

It appears that the Wikimedia Foundation has nearly run out of legitimate ways to spend the donors’ money, because much of it ends up in the organization’s savings accounts and bonds, or pays for software programmers who don't really seem to be doing anything worthwhile.

Re:Not sure there's a problem...

[thekohser]

So from this information alone, I'm not sure I see the problem. You have a very large website that I'm sure gets unimaginable amounts of traffic, operating for free and supported by voluntary donations, and their budget is increasing because they've hired engineers to keep the thing running. That all sounds reasonable enough.

Then you are a shining example of someone who has accepted the Wikimedia Foundation's spin.

Let me help you with some facts. In late 2005, all of the Wikipedias (in every language then supported) generated about 5 million edits per month. The WMF monthly budget then was $58,000. So, cost per edit was 1.16 cents. The current edit load is about 10 million per month. The WMF current monthly budget is $3,750,000. Current cost per edit is 37.5 cents.

Considering how hosting and bandwidth costs have decreased dramatically since 2005, how do you explain a 30-fold increase in spending per edit? Please don't say that it's accounted for by increased page views without edits, because I can give you those stats, too. The reason for the increase is that Sue Gardner built a staffing empire around herself, then told all of these programmers to do exciting new things with the software that nobody on the Wikipedia editing community had actually desired. Then, after years of literally a hundred programmers working on things like "Visual Editor" and "Media Viewer", when they rolled them out, they didn't work well at all, and the community literally wrote patch scripts to keep the software enhancements off Wikipedia, to which the Foundation responded with a hastily-written "superprotect" script that forces the terrible, disliked software enhancements back on the users.

This is exactly how you waste about $20 million per year.

Re:Not sure there's a problem...

[nine-times]

That's because this is Slashdot and you haven't bothered to actually read TFA.

I actually skimmed them, but there are 5 articles, including what seems to be Wikimedia's budget report. I'm not going to read all of that in detail unless someone can explain what the real problem is.

It seems like your complaints (and these were also in the various articles) boil down to two things:

A) They don't spend all of their money on content: Well, I wouldn't expect them to. My understanding was the the Wikipedia has always relied on volunteer contributions, and the idea was that it always would. I'm not familiar with the inner politics of the thing, but it seems like they're largely providing the platforms for volunteers to create content on, and obviously those platforms will cost money. If you had asked me yesterday (before I heard about this controversy) to guess what Wikimedia spent their money on, I would have guessed "Mostly hosting, web/software development, and administrative overhead." I wouldn't have guess they spent very much on content at all.
B) They released some tools for editing content and viewing media, and some people (perhaps "a lot of people" or even "most people") didn't like these tools: It's not clear to me what the real problem here is. Do you think that they should not have programmers attempt to improve their platform? Do you think that they shouldn't pay those programmers? Do you think that it's fine to try to improve the platform and pay programmers, but they just did a bad job? If it's the last one, then it seems like the issue isn't a complaint about the budget as much as "I'm just not happy with the output of the developers." Maybe they should get new developers or something, I don't know.

And then there's this:

Less than 6% of the WMF budget is spent on Internet hosting even though most people probably believe it’s their biggest expense. Meanwhile, they spend almost as much money (about $2 million) on travel and conferences. There is also a huge bucket for “other operating expenses” totaling nearly $12.5 million — some of which certainly pays for expensive downtown office space in San Francisco.

Ok, so that seems like a lot of money to spend on traveling and conferences, what what was the effect of that? Were those conferences things that they shouldn't have gone to or presented at? If you want me to be angry, I think you need to paint me a picture. Did they spend so much money because they were flying a single guy around in a private jet, or were they flying around a lot of important people to important conferences, paying for conference materials and placement, in a way that resulted in some improvement to Wikimedia? You say they spent money on office space in San Francisco-- is that unusual and unreasonable for a company in their position? Did they spend too much? Or is the problem simply that they've thrown so much money into "other operating expenses" without breaking it down to allow us to determine whether those expenses are valid?

I just feel like I'm supposed to be outraged, but I don't really see what the problem is, other than a vague sense of "They're spending lots of money, and we don't think that it should cost that much." Having run a business, I know that a lot of things end up costing more than you'd suppose that they would.

Re:Use the singular

[VGPowerlord]

The Foundation "is", not are. It is one entity. You're not referring to all the people within the Foundation, you're referring to the Foundation itself. You even use the word "it", not them, to refer to the Wikimedia Foundation.

You use is when referring to a singular entity.
You use are when referring to more than one entity or a group, such as they.

From my observations, this is one of those points where UK and US English disagree.

Organizations are referred to as plural in UK English and singular in US English.

Re:Real ads would work better

[wonkey_monkey]

Yeah, why let silly little things like principles get in the way?

Just display ads already

[iamacat]

It is true that some advertisers may pull their campaign if they don't like the content, but a popular site will always generate enough interest from someone to cover operating expenses. No pandering or user tracking needed.

In fact, why not focus on educational content, like books on the subject related to the page? There are few other opportunities to promote specialized science/history books, and it would be in line with the mission of educating the world.

Re:Not only that...

[dugancent]

"Ability fix things". The tiny midwestern town that I was born in has a Wiki page that states it was devastated by fire in the 1960s. This never happened but it was devastated by a major flood in 1937, which it barely mentions. I corrected it and it was reversed stating that I needed sources..How do you source something that didn't happen? There was never a major fire.

I tried again a few years later (2012ish) and it was again reversed. I quit trying.

Re:Both examples are for generating and curating c

[thekohser]

It's difficult to argue with someone who believes that adding a diamond-encrusted, solid gold frame (in the shape of a trapezoid) to the Mona Lisa would be "generating and curating" artwork.