Global Tel*Link and Securus Technologies are the two major players in the $1.2 billion business of providing phone service to private and government prisons, according to Bloomberg. Global, an Alabama-based company has about half of the correctional phone services market and Securus Technologies has about 30%. Both companies make excessive profits with exclusive contracts with prisons. The major prison telephone companies and the prisons have a de facto partnership. As part of the contract, the prison receives commissions from the exorbitant charges paid by inmates and their families.
Securus, Global, and other prison telephone companies paid prisons $460 million in commissions in 2013. Sens. Cory Booker (D-N.J.), Bernie Sanders (I-Vt.) and 14 other Democrats said last Thursday that the payments amounted to “kickbacks” to win contracts.
At the Contra Costa West County Detention Facility in Richmond, California, detained immigrants pay about $20.00 for a fifteen minute telephone call. Phone Justice for Immigrants in Detention reported that Global Tel*Link pays Contra Costa County a commission of up to 57% on phone calls, in addition to a $75,000 bonus for awarding the exclusive contract. The county received $653,506 in commissions from Global from 2011 – 2012.
There are approximately 2.2 million inmates incarcerated in the United States. The telephone prison companies had until now a captive market. The industry grossed almost $1.2 billion in yearly revenues and made excessive profits at the expense of inmates and their families. In some states, a 15-minute phone call costs $17. Price-gouging became epidemic.
The FCC passed today, new regulations, which will cap the average 15-minute phone call at $1.65. The new rules will also prohibit excessive additional fees and hopefully change the practice of companies paying local sheriffs a percentage of jail phone revenues. The new rules will start in 2016, but the FCC expects that the prison phone companies will appeal the decision. In the meantime, in April, International Business Times reported that Securus started requiring county jails that had contracts with Securus to remove in-person visitations for its video visitation service. Securus video visitation costs $20 for a 20-minute phone call. The FCC does not regulate video visitations.
Founder of prisonpath.com