Is Wikipedia on the Brink of Financial Collapse?

If you try to visit Wikipedia, you might see an ad with the following message. (I blurred the currency because it is adapted to your IP address.)

wiki donate.jpg

My first feeling was that of mild panic. I had no idea Wikipedia was in so much trouble. If so, this seemed like a true emergency. After all, what would we do without Wikipedia?

Now, let’s face it. Everyone uses Wikipedia. If there ever was an institution that deserves a donation to keep it afloat, Wikipedia must be it. Besides, the ad makes it real easy to contribute. Just click a few buttons and they get your money. However, having worked for non-profit organizations myself and finding them somewhat wanting in transparency, I decided to look into Wikipedia’s financial situation.

Wikipedia lists its total assets for 2015 at around $83 million. Their total expenses were around $52.5 million. This means they made around $23 million in ‘profits’ which cannot, for legal reasons, be called ‘profits’. They are termed ‘unrestricted net assets’. These are assets that they are able to use in whatever way they want. But the bottom line is this: Wikipedia is not poor. That was a relief.

So what do they need more money for? What most people don’t know is that there is a lot more to Wiki than just Wikipedia. Here is the rest of what is called the Wikimedia Foundation.

wikimedia family

Certainly these also need support from somewhere. So how can I be sure all my money will go to the floundering Wikipedia and not the other services, which I never use?

The truth is, I can’t be sure. It can go to any of the above or none at all. My money may go to completely different projects entirely. It may just go to paying salaries to those who work for Wikipedia. And that brings me to the next point I’ve learned from working for non-profit organizations. Always find out what the top person makes.

Jimmy Wales, the founder of Wikimedia, is said to have a net worth of $1 million, which is pretty modest by internet entrepreneur standards. His executive officer, Lila Treitikov, made $350,000 a year at last report. The average salary for a Wikimedia Foundation worker is $95,845, according to Are these salaries acceptable to you as a donor? That’s up to you to decide, because if you donate, it’s you who are paying them.

However, my first reaction to the request for financial support had nothing to do with worker salaries. My first thought was that this might have been some kind of scam that was being perpetrated by a cyber criminal. Was I really being contacted by Wikipedia or was this a fake site?

It turned out to be real, but it raised serious questions. Couldn’t criminals compromise this payment system through using a spoofed web page or man-in-the-middle attack, among others? It wouldn’t be the first time the organization was hacked. After all, it is a tempting target. They possess a lot of information about donors which they make clear they will use.

“We use personal information collected from donors for the purposes of processing payments and communicating with donors about Wikimedia as well as conducting the fundraising and other operations of Wikimedia. This information may include name, amount donated, address, telephone number, donor comments, e-mail address, and any other personal information provided to us.”

 And for those of you hackers planning on writing a spear phishing email, don’t forget to check out the Staff and Contractor page for emails, phone numbers, addresses, and other useful personal information.

 Although the Wikimedia Foundation does not have advertising, if you donate over $1,000, you can have your name listed among the donors with a link to your business website. A Legacy Gift will give you a short biography on the site. These are gifts individuals leave to Wikimedia in their wills. If they put an asterisk next to your name, you have died, but your gift keeps on giving. In this case, your biography becomes kind of a cyber epitaph. And if you feel like getting more than a pat on the back for your donation, you can always buy a t-shirt at the Wikimedia Shop ($25).

The ad states that if everyone who uses the site gave only $3, “the fundraiser would be over in an hour.”

wiki 3

Really? I checked out the math behind this. It’s true that Wikipedia is the 7th most visited site in the world with 15 billion views a month. Other sources claim that it has 13.29 million unique visitors a day. Thus, by my calculations, an hour of $3 donations by unique visitors would net about $1,650,000. Is this all it would take to keep Wikipedia alive for a year? If this is true, then Wikipedia only takes up 2% of the Wikimedia Foundation’s total budget.

So, my final analysis is that Wikipedia is alive and well and in no danger of suffering a financial collapse. In fact, it seems that the Wikimedia Foundation is only using the threat of a Wikipedia demise to fund other projects and pay salaries. This is not an illegal marketing tactic, but it feels a bit shady. I like Wikipedia and like what it does, but it seems to me they need to be more transparent and make it clear how, specifically, these donations are being used.

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