Wikipedia:Wikipedia Signpost/2005-02-14/Budget and contract

As part of the Wikimedia Foundation's continuing effort to become more self-sufficient and keep up with the demands of Wikipedia traffic, it is eliminating its financial dependence on Jimmy Wales' independent company, Bomis, Wales disclosed last week.

Hosting contract being changed
In a post to the wikitech mailing list last Wednesday, Wales indicated that he planned to change the contract with the colocation centre so that the Wikimedia Foundation would be paying for hosting directly, rather than paying Bomis. Under the new contract, Wikimedia will provide bandwidth for Bomis and charge the company according to the amount it uses.

Wales originally used Bomis to help fund the Nupedia project from which Wikipedia developed. Wikipedia was placed under the non-profit Wikimedia Foundation in 2003, but Bomis continued to pay for basic expenses. As traffic increased and more servers became necessary, Wikimedia fundraisers helped purchase the needed equipment while Bomis remained responsible for the cost of hosting and bandwidth.

Since September 2004, Wikimedia has been paying for half of the total bandwidth used by both organizations, somewhat less than a proportional share. The change reflects Wales' repeated statements that he intends to keep his commercial enterprises, which also include another company called Wikia, separate from Wikimedia. It also marks a major change in that the Foundation, while obviously still heavily dependent on donations and volunteer effort, is directly handling its own expenses.

Changes in hardware, new budget and fundraiser dates
In related activity, the Wikimedia servers were being changed to a new network switch, and the slower existing switch was being returned to Bomis, its owner. Wales indicated that this would allow Bomis' bandwidth charges to be allocated easily. The change caused some intermittent delays in using Wikipedia on Saturday.

Also, a set of recently ordered new servers (see archived story) arrived last week, which should help Wikipedia site performance. However, they are still being set up and configured for use, and have not been added to the active server lineup yet.

More hardware will likely be ordered in the coming months, as the Wikimedia Foundation approved a $130,000 budget last week for the first quarter of 2005. The budget allocated at least $75,000 to servers and other hardware, as both Wikipedia traffic and the associated costs are still growing at an exponential rate. As part of the budget plan, the Foundation plans to start a fundraising drive on Friday, 18 February, with a goal of raising $75,000 over three weeks.