Ray Mahlaka
3 minute read
9 Feb 2017
12:33 pm

Negotiations on Please Call Me money reach deadlock

Ray Mahlaka

Negotiations between inventor Makate and the telco provider are now at deadlock.

Nkosana Makate has dismissed Vodacom’s assertion that it faces difficulties in determining the revenue that the Please Call Me idea has generated since its inception in 2001.

Makate, the inventor of Please Call Me, argued in court papers filed at the Constitutional Court on Tuesday that Vodacom has substantial financial records required to determine how much it owes him for the idea.

A fresh battle is heading to the Constitutional Court again – with Makate seeking clarity on last year’s groundbreaking order that compelled Vodacom to enter into good faith compensation negotiations with him.

Negotiations have now deadlocked as Makate accused Vodacom of trying to renege on its obligation to pay him for Please Call Me, which allows a cell phone user without airtime to send a free message requesting to be called back.

As part of compensation negotiations, which began in September last year, Makate requested Vodacom to give experts (appointed by him) access to its records to determine the revenue that the idea generated.

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In January, Vodacom revealed in its court papers that Please Call Me was never treated in its income statement as a revenue generating product. It also argued that it was unclear which calls were induced by a Please Call Me message and which were not – making it difficult to determine what does and doesn’t qualify as revenue generated by the idea.

However, Makate suggested that in order to determine the revenue a “simple computer program” was required to identify calls made within a set period of a Please Call Me message being sent to a particular number and then calculates the revenue generated for Vodacom by the calls.

“While Vodacom and I might need to negotiate the precise response time to be used (for example ten minutes after the Please Call Me message) this demonstrates quite clearly that the revenue records can be obtained,” he said.

Years after Please Call Me launched, its messages included advertising campaigns, the revenue amount from which Makate says “must be readily available”.

Supporting Makate’s responding court papers is an affidavit by Andrew Hendricks, who was employed by Vodacom in various financial roles between 2001 to 2014.

Hendricks said due to his knowledge and experience of financial agreements with Vodacom’s service providers, the telecommunications company has the ability to calculate the total revenue per product and then determine the revenue share component. “In addition, they know exactly how much advertising revenue is generated off the tagged-on advertisement to the Please Call Me messages.”

Hendricks said the average revenue generated per call, per day is one aspect that can be reasonably determined with the Please Call Me records.

Makate wants 15% of the revenue generated by Please Call Me since its inception, which he estimates to be in the millions. He invented Please Call Me in 2000 while working as the company’s trainee accountant. What followed was a nearly 16-year long dispute with Vodacom to be compensated for the idea.

Vodacom argued that it’s open to other methodologies to arrive at a reasonable compensation amount as opposed to Makate’s demand for a share of Please Call Me revenue. It also argues that Makate’s interpretation of the Constitutional Court’s order is incorrect, as it doesn’t suggest that the company is obliged to pay him a share of revenue.

Makate said it’s necessary for the court to clarify its own order for successful compensation negotiations. He added that other compensation methodologies proposed by Vodacom “will lead only to a waste of time, energy and money – all to my detriment”.

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