Shameel Joosub offered Please Call Me’s Makate more than Google was worth

Vodacom CEO Shameel Joosub offered Nkosana Kenneth Makate more for his Please Call Me idea than what Larry Page and Sergey Brin could sell Google for in 1999.

On Thursday, Vodacom and Makate continued their 16-year legal battle around compensation for the “buzzing option” idea he shared with the operator on 21 November 2000.

The idea was for Vodacom subscribers who have run out of airtime to “buzz” another number and receive a return call.

Makate said people without airtime “should be able to at least dial, and the receiving phone should ring and register a missed call”.

“The other caller will, in turn, notice a missed call and call back the original caller who is without airtime,” his original memo stated.

Although the idea was not technically feasible, it helped the Vodacom product development team create a service that solved the problem.

Vodacom launched its “Call Me” service on 15 March 2001, a carbon copy of MTN’s “Call Me” service launched a few weeks earlier, on 23 January 2001.

Vodacom later changed the name to “Please Call Me” after legal threats from MTN, who held the patent for the service, that it was infringing on its rights.

Vodacom credited Kenneth Makate, who worked in its finance department at the time, with the idea that led to the Call Me service’s development.

“Kenneth suggested this service to the product development team, which immediately took up the idea,” Vodacom said in 2001.

Andrew Mthembu, Vodacom MD at the time, said he was impressed with the product and that the idea came from a staff member.

“Most impressive to me was that the idea of the product came from one of our staff members whose job is not related in any way to product development,” Mthembu said.

Makate was promised compensation — or at least a discussion about compensation — for the idea. However, there was no agreement on how much he would receive.

When Vodacom rebuffed his letters of demand, Makate started legal proceedings in 2008.

After 16 years of legal battles and court rulings, the matter appeared before the Constitutional Court for a second time this week.

In April 2016, the Constitutional Court ordered Vodacom and Makate to negotiate and agree on a reasonable compensation amount payable to Makate.

The court order stated that if negotiations deadlock, the matter should be referred to the Vodacom CEO for determination.

On 9 January 2019, Vodacom CEO Shameel Joosub awarded Makate R47 million. However, Makate rejected the offer as an “insult” and “shocking”.

Makate returned to the courts and received favourable rulings in the High Court and Supreme Court, entitling him to a minimum compensation of R29 billion.

However, Makate said he would settle for a R9.4 billion payment from Vodacom for the idea. His legal team said this amount would not kill Vodacom.

As part of the legal proceedings, Makate’s legal team compared the brilliance of their client’s idea to Google.

His legal representatives said it “wasn’t just a brilliant idea, it is one of the most brilliant ideas there have ever been”.

“Vodacom has described the idea as a world first. It’s been described as one of Africa’s best five inventions. It’s been equated to Google,” advocate Stuart Scott said.

This raises the question of how Makate’s R9.4 billion compensation for his idea compares to the value of the idea that created Google.

Valuing an idea is impossible, as an idea does not hold much value. It has no legal protection and should be patented before it is protected.

However, the Google example is relevant as the founders, Larry Page and Sergey Brin, tried to sell their company after it started to gain traction.

Their idea for Google started in 1996 as “BackRub”, a research project about the mathematical properties of the World Wide Web and understanding its link structure as a huge graph.

With the help of Scott Hassan and Alan Steremberg, they built a company around their search algorithm. Google was officially launched in 1998.

By the end of 1998, Google had an index of about 60 million pages and produced more accurate results than its market-leading competitors.

In 1999, Brin and Page approached Excite CEO George Bell with an offer to sell their company for $1 million.

Bell rejected the offer. Vinod Khosla, one of Excite’s venture capitalists, talked the duo down to $750,000, but Bell still rejected it.

Brin and Page could, therefore, not get $750,000 for Google. At that stage, it was already a powerful search engine and no longer just a concept or an idea.

• What Google offered for R18 million: The idea, patents, and a company
• What Makate offered for R9.4 billion: The idea

The image below shows the difference in what Makate wants for his Buzz idea compared to what the Google founders wanted for Google as a fully-fledged search engine built on their idea.