Wikipedia founder remakes web-publishing economics

Wikipedia founder Jimmy Wales said on Monday his for-profit company, Wikia, is ready to give away—for free—all the software, computing, storage and network access that website builders need to create community collaboration sites.

Wikia, a commercial counterpart to the non-profit Wikipedia, will go even further to provide customers—bloggers or other operators who meet its criteria for popular websites—with 100% of any advertising revenue from the sites they build.

Started two years ago, Wikia aims to build on the anyone-can-edit success of the Wikipedia online encyclopaedia. Using the same underlying software, called MediaWiki, Wikia hosts group-publishing sites, known as wikis, on topics from Star Wars to psychology to travel to iPods.

“It is open-source software and open content,” Wales said in a phone interview. “We will be providing the computer hosting for free, and the publisher can keep the advertising revenue.”

That could prove disruptive to business models of websites that provide free services to customers but require a cut of any resulting revenue in return.

Wikia gives away the tools and the revenue to its users.
It requires only that sites built with the company’s resources link to, which makes money through advertising.

Wikia calls the free-hosting service “OpenServing”. It runs on an easy-to-use version of MediaWiki software developed by, a sports fan community site Wikia recently acquired and plans to extend.

Wales is betting the plunging cost of computers and networks can help Wikia support the free-services offer. “It is becoming more and more practical and feasible to do,” he said.

Wisdom to prevail

“We don’t have all the business-model answers, but we are confident—as we always have been—that the wisdom of our community will prevail,” he said.

The move follows the announcement last week that had become Wikia’s first corporate investor and is acting as the sole investor in Wikia’s second round of funding. Terms were not disclosed.

Wikia took $4-million in funding in March from Bessemer Venture Partners, Omidyar Network, high-profile Silicon Valley “angel” backers including Marc Andreessen, Dan Gillmor, Reid Hoffman and Mitch Kapor and Joichi Ito of Japan.

In recent months, has revealed an ambitious strategy of its own to offer a range of low-cost computer, data storage and website-hosting services to companies large and small, which could come into play for Wikia.

Wales said using Amazon to supply web services is not part of Wikia’s deal with Amazon. “Potentially, but this is really completely separate,” he said when asked if there was a tie.

Wikia aims to become is a clearinghouse of free software.

Armchair’s software is the first of hundreds of freely licensed software packages to be hosted by the company in the near future, Wales said. These could include popular open-source publishing software such as WordPress and Drupal. Consumers would then have a single password across all sites.

“The real concept is to become much broader, to host lots of different free software and free content, Wales said.

Thirty-thousand users have posted 400 000 articles so far on Wikia sites. The San Mateo, California-based company employs 38 people, including top volunteer editors from the Wikipedia.—Reuters

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