Another twist in ‘R63 billion’ Please Call Me saga

 ·30 Jun 2024

International mobile giant Vodafone is reportedly trying to get involved in the local ‘Please Call Me’ saga, which could see Vodacom on the hook for up to R63 billion.

The Sunday Times reports that Vodafone, the majority shareholder in Vodacom, has applied to be a friend of the court in the ongoing legal battle between Makate and Vodacom over the Please Call Me service.

Makate is opposing the application on the basis that it is premature as the court has not yet accepted the case, that Vodafone is not a friend of the court but a majority shareholder in the group being litigated against, and that the numbers quoted by Vodacom for his claim (up to R63 billion) are incorrect.

He said his claim from 2020 still stands – R9.7 billion.

The entire saga is back at the Constitutional Court after Vodacom was ordered by the Supreme Court of Appeal to pay Makate billions of rands owed to him for the idea behind the Please Call Me service.

Vodacom noted in March that it was on the hook for between R40 billion and R63 billion, based on this order.

The protracted 20-year legal battle has been going back-and-forth between various courts, with the Constitutional Court now again expected to bring finality to the case.

According to Makate, he had an idea for a free missed-call service that he shared with his superior at Vodacom in 2001. The service aimed to allow customers to get their contacts’ attention without using airtime.

As reported by Daily Investor, Vodacom launched the service, known as Please Call Me, in March 2001, and it became widely used across South Africa.

Makate launched a lengthy legal battle against Vodacom, seeking compensation for his idea.

Makate’s legal team had initially demanded R20 billion to compensate him for his idea, based on a calculation that the Please Call Me product had generated R205 billion in revenue since its implementation. 

Vodacom did not share Makate’s views on how much revenue the service generated or how much he deserved. The courts, however, sided with Makate on the matter.

After being ordered to fairly compensate Makate for his idea, Vodacom initially offered him R10 million. Makate rejected this offer, and Vodacom CEO Shameel Joosub’s team then constructed four models to estimate how much Makate should get based on different scenarios.

After averaging the two models with the highest values, he came up with an offer of R47 million. However, Makate rejected this as well, and the matter again ended up in court again.

Makate approached the High Court, and in February 2022, the court ruled in his favour. Vodacom appealed this ruling at the Supreme Court of Appeal.

However, the Supreme Court dismissed Vodacom’s appeal and ordered the company to compensate Makate between 5% and 7.5% of the revenue generated by the service over 18 years.

According to MyBroadband’s analysis, this ranges from R28.99 billion to R55.37 billion using the models accepted by the court.

Vodacom, again, was not happy with the result, and opted to take the matter back to the Constitutional Court. In the meantime, the parties have tried to negotiate in out-of-court settlement talks, which have been deemed “strictly confidential”.

Read: Vodacom takes Please Call Me saga back to the Constitutional Court

Show comments
Subscribe to our daily newsletter