Vodacom in hot water

By Christelle du Toit, ITWeb senior journalist

Johannesburg, 11 Feb 2008

Cellular giant Vodacom has been accused of operating an illegal lottery in the guise of its "100 cars in 100 days" competition.

Sershan Naidoo, spokesman for the National Lottery Board (NLB), said this morning that the NLB's legal team is preparing a case against Vodacom, including a cease-and-desist order against its much-advertised promotional campaign.

"If a company is having a promotional campaign for a product, the customer should not be paying more for that product than they usually would," Naidoo explains. He says the R10 per entry charged by Vodacom in order to qualify for a new BMW made the competition illegal.

"The NLB is the regulator for all games of chance in the country and if Vodacom wanted to charge more than the cost of a normal SMS for people to take part in this competition, they needed a licence from the NLB."

A report by Afrikaans newspaper Rapport, on Sunday, quoted independent ICT lawyer Reinhardt Buys as saying Vodacom contravened the Wireless Application Service Providers' Association (Waspa) code of conduct by inviting multiple entries for the competition. Waspa has indicated that it will comment on the matter in due course.

Buys could not be reached for comment this morning.

According to Shameel Joosub, MD of Vodacom South Africa, the company is responding to an enquiry by the NLB. "The enquiry essentially requires that we provide the terms and conditions of the BMW promotional competition, which we are doing," he says. "These terms and conditions are and have been publicly available on www.100cars.co.za. To date, more than 88 BMWs have been won. Customers who are spending excessive amounts [on sending numerous SMSes to enter the competition] are and have been contacted to make them aware of their spend."

He adds: "This promotional competition is being conducted in terms of the National Lotteries Act, and has already been conducted in several other countries in Europe."