Nkosana Makate wants R20 billion from Vodacom

Kenneth Nkosana Makate, who proposed a Please Call Me idea to Vodacom, wants R20 billion from the mobile operator.

The amount sounds preposterous, but it aligns with High Court and Supreme Court of Appeal (SCA) rulings that backed Makate’s claim.

Makate, a Vodacom finance manager at the time, pitched his idea of a method to “buzz” someone else’s phone without airtime to a superior on 21 November 2000.

His idea was ultimately developed into Please Call Me, which launched on the Vodacom network in 2001.

Although Makate was not involved in the development or launch of the product, his manager had promised him compensation for the idea.

Makate wrote to Vodacom in 2007 demanding payment and launched legal action in 2008. Since then, there have been numerous court cases around the matter.

The case ultimately ended in front of the Constitutional Court, which ordered Vodacom and Makate’s teams to negotiate reasonable compensation in good faith.

Foreseeing the inevitable breakdown in talks, the Constitutional Court included a failsafe in its ruling that designated Joosub as the deadlock-breaker.

Joosub used several models to determine suitable compensation and arrived at an overall figure of R47 million, which Makate rejected and challenged in court.

Vodacom CEO Shameel Joosub

He took the matter back to the High Court, arguing that Joosub’s offer was well below what was owed to him.

In 2022, the High Court ordered Vodacom CEO Shameel Joosub to recalculate the R47 million offer made to Makate. It said he was entitled to at least 5% of all PCM revenue.

Vodacom appealed this ruling. However, the SCA dismissed Vodacom and Joosub’s appeal this week and confirmed the High Court’s order.

It ruled that Vodacom must pay Makate between 5% and 7.5% of the total voice revenue generated by the Please Call Me product over 18 years, plus interest.

The SCA backed the High Court’s order that the revenue share must include PCM revenue derived from prepaid, contract, and interconnect fees as set out in Vodacom’s annual financial statements.

Using this model, Makate’s legal team calculated that Vodacom generated R205 billion over 18 years through PCM. Adding interest, Makate wants around R20 billion from Vodacom.

Speaking to Newzroom Africa, Makate said the Supreme Court of Appeal was “emphatic and unambiguous” in its ruling. “We are happy with the judgement,” he said.

He said the Supreme Court of Appeal has upheld what they have submitted to the High Court, which included the R20 billion claim.

Makate said they are reaching certainty regarding the prolonged legal battle, which has been dragging on for 15 years.

“If they want to appeal the ruling at the Constitutional Court, they will have to advance a constitutional point,” he said.

“Whether the Constitutional Court deals with numbers as a constitutional matter is another story.”

Vodacom did not share Makate’s enthusiasm, saying it was planning to appeal the Supreme Court’s ruling.

“Vodacom is surprised and disappointed with the judgment and will bring an application for leave to appeal before the Constitutional Court of South Africa,” it said.