If you read the article, you'll notice it says that the expenses are growing faster than the traffic, and faster than revenue. This is the exact opposite of what you would normally expect (due to economies of scale).
Succinct and correct. I have been a regular donor to Wikipedia for years now, because I use the service heavily, support its mission, and like the access I have to contribute to its vast body of knowledge. When the fundraising solicitations come around, I've typically been too busy to look into the financials and have always assumed they operated at near costs and had declining revenue. Now, perhaps Wikipedia has some unfortunate but real problems around editorializing, and they have to pay a growing army to keep the worst of the forces of troll-dom at bay with conscientious hired curatorial help. Otherwise, I see no other reason why they should have 300X the employees.
And this is exactly the issue. Fund raising got to be "too" successful, which is to say at some point WMF did a fundraising round and they had more money than they needed, and rather than give that money back they spent it. And the next year, what ever it was they spent it on (could have been salaries or perks or what ever) seemed like "of course we need that thing we did it last year" and so they targeted to raise the higher amount, but they over shot again, and then spent more.
This has been a trap for charitable organizations ever since they existed. Churches, clubs, museums, Etc. The second trap is embezzlement which happens all the time because, as a donation funded organization for some reason people often neglect strong financial controls.
The article author is correct that unless corrected, this situation will kill the Wikimedia Foundation.
> I see no other reason why they should have 300X the employees.
Well, that's a little unfair. When you measure from 1, virtually any number will look like an absurd multiple. Calling it 300x makes it sound ridiculous but for a company with $80MM in revenue, 300 employees doesn't seem to be unreasonable.
Supporting many more languages and new projects like news and structured data should require more individual contributors and a corresponding management structure. Then of course you need HR to manage them, a fundraising organization that gets money from all over the world, and yet more people to handle the finances that have now gotten complicated.
To me, it's a no-brainer that the WMF of today needs more than one employee. Whether it needs 300, I don't know, but that doesn't sound far enough off for me to quibble with them over it.
They may need more than one, and I'm sure there are fixed or near-fixed labor costs pertaining to HR, legal, accounting, etc. but what business function besides content curation - which another commenter above claims is entirely volunteer, does WMF need that approaches even a linear growth rate to remotely justify the jump in orders of magnitude, let alone 300X?
Wikipedia hires php programmers as well. Last year I saw a posting on stackoverflow. Think the devop work required, project management, handling media, ever increasing storage needs, the managers, etc.
300 feels like too much but 80 could be a logical number.
The table of spending vs. revenue suggests revenue is growing just as fast as expenses. There's nothing here about the trends of the amount of traffic over time. And if there was, the cost of hosting and developing a system vs the amount of traffic is can take is not a linear relationship.
> There's nothing here about the trends of the amount of traffic over time.
Yes there is.
2005: > So, we're doing around 1.4 billion page views monthly.
2016: > According to the WMF, Wikipedia (in all language editions) now receives 16 billion page views per month.
The version of the article on the signpost lacks the table of figures, if you go to the version on his user page, it paints a clearer picture [0].
idorosen has posted a table on the root thread which adds a column for the expense ratio (1 minus the margin) and it's getting much higher much quicker [1].
Well, try to draw a trend line through the operating margin and tell me it's not that scary. I think that it's pretty scary if your permanent, ongoing financial commitments are growing to match your revenues. This way, you have no cash to react to intermittent expenses or R&D. And let's remember that Wikipedia is already doing more donation drives than ever.
