Please call me about the money
NKOSANA Makate, who this week won a lengthy legal battle against South Africa’s largest mobile network operator, plans to scrutinise Vodacom and its parent company Vodafone’s records to determine what they owe him for the idea that has made billions for the group.
The Constitutional Court ruling Vodacom compensate Makate for his Please Call Me innovation stipulated that negotiations over compensation be concluded within 30 days of Tuesday’s judgment.
Makate is seeking 15c for every rand of revenue that Please Call Me has generated. This is not only what Vodacom has earned but also what parent Vodafone has made.
Asked who would lead negotiations on his behalf, Makate said: “We’re reassessing the team, we’re beefing it up with actuaries, auditors and accountants so that we can do this properly. We’ll look at the big firms [with] an appetite to assist us.”
Makate said the judgment paved the way for him to request the records of all Vodafone operations where Please Call Me had been implemented. UK-based Vodafone has a 65% stake in Vodacom.
Please Call Me “is everywhere where Vodafone operates, so it’s not only confined to South Africa. We want all records: South African records, Tanzania, all of them where they’ve implemented the product.”
Please Call Me messages often include advertising, which generates additional revenue. The documents that will be requested include where and to whom Vodacom licensed the product.
“Then we can quantify the 15%. That’s really what’s outstanding between us and Vodacom,” he said.
A 2011 judgment in the High Court in Johannesburg ordered Vodacom to disclose these records to him, Makate said. But at the time the mobile network operator insisted that his claim to the existence of an agreement to pay him for the idea had to be proven in court first.
The 2011 order included that Vodacom provide excerpts from the KPMG audit report commissioned by Telkom and Vodacom shareholders in 2008 which detailed how Vodacom determined revenue-sharing agreements with other partners.
The KPMG audit report followed allegations from former Vodacom employees that the then CEO Alan Knott-Craig had exploited company resources for the benefit of his family members. The report was never publicly disclosed but allegedly exonerated Knott-Craig.
“In the summary Judge Jafta [this week] says the fact Vodacom chose to associate itself with these lies [that Alan Knott-Craig came up with the idea] . . . was unethical. That for me was profound,” Makate said.
“But the other thing, he said they relied on apartheid laws. On laws that were done pre-constitution. That for me is significant: that [the judge] would advance those arguments that for such a young company, a company of the new dispensation, to still rely on apartheid laws to make its case is inexcusable.”
But for Makate the most poignant moment of all at Constitutional Hill came on September 1 last year when Chief Justice Mogoeng Mogoeng questioned Vodacom’s counsel about justice.
“He said, ‘You had nothing before this, and then you opened your eyes and then you had this. And then you made billions, and then he does not get a cent out of this. Where is justice in this?’
“He was asking Vodacom’s counsel, and they couldn’t answer . . . We knew from there that we might get something out of this, it was tilting in our favour.” See Page 6