Why the ‘Please Call Me’ product is worth billions
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Kenneth Makate, who invented the Please Call Me service, says the invention is worth R10 billion.
This value has been questioned by some who claim it’s too much for the invention. But others have suggested that Makate deserves to be compensated more.
The Please Call Me debate is forcing South Africans to begin a discussion about the value of information products, and how to compensate innovators at work. There’s no question about compensating Makate for his invention, as the Constitutional Court declared. The value of the compensation is the bone of contention and Please Call Me’s worth needs to be determined.
The dominating narrative is that Makate simply presented an idea without implementing and, therefore, he does not deserve much in terms of compensation. This reasoning is flawed since the idea was based on an understanding of the market conditions, and the value of the unstructured supplementary service data (USSD) technology. There are a few reasons why Makate deserves billions.
One of the main challenges in implementing consumer technology services in Africa is the affordability of communication. In comparison with other parts of the world, the African consumer market does not spend much on technology communication services. This was more so in the early 2000s when the service was invented.
The affordability of communication was the driver for the creation of this service. At the time this was a major challenge for consumers and companies like Vodacom.
It can be argued that the concept was not just technology. It also introduced a technology commercialisation strategy that did not require the audience to pay, the freemium model.
This alone was a great achievement by Makate who understood this based on his observations as an accountant at the time with Vodacom. What Makate achieved for Vodacom is equivalent to what Google achieved with enabling the public to search for anything online for free.
When Google was created, this approach was considered revolutionary. The Please Call Me Service also took USSD to another level. What Makate introduced was a value-added service on top of the USSD platform. It differed from other inventions from MTN and Orange Personal Communication Services.
Makate’s idea was that the service should be focused on people with prepaid cellphones, who were out of airtime. This target market was key, especially when one considers that the service was first introduced in Africa where most users at the time were always running out of airtime.
These factors should be considered before anyone declares that the Please Call Me service is not worth much. Decision-makers who make decisions about the value of information products need to understand the true value of information assets and ideas.
For example, Facebook acquired WhatsApp, a service which enabled free communication via cellphones for $19.3 billion (R293bn).
Makate enabled Vodacom to access a tough African market with a groundbreaking tech-commercialisation strategy. The true value of the Please Call Me product should be determined and not only take advertising revenue generated from the service into account.
The Please Call Service as a product should be measured. It should also consider its service audience in the same way that Facebook’s audience is measured.
Each person who used the service has to have a monetary value attached to them.The Please Call Me concept is worth a patent. And its inventor should be rewarded accordingly.