With Massive Merger, the Prison Phone Industry Could Become Even More Lucrative
By Kalena Thomhave | Jul 26, 2018
The prison phone industry, which has come under fire for the exorbitant fees it charges prisoners calling home, may be set to become even more profitable. This month, the giant inmate phone services company Securus petitioned the FCC to approve its plan to buy a smaller competitor, ICSolutions.
If the Trump administration’s Federal Communications Commission approves the merger, just two companies (Securus and Global Tel Link) would control between 74 percent and 83 percent of the market, according to analysis by the Prison Policy Initiative (PPI). (Securus responded to PPI’s analysis, calling it “unreliable and misleading.”)
I previously wrote about how the prison phone industry is lucrative for both companies and states: Companies squeeze as much money as possible out of prisoners and their families, who are typically poor, while states often award contracts to phone companies that are willing to pay the highest commission rates. As a result, prisoners and their families may pay as much $1 per minute for a phone call.
As Aleks Kajstura, legal director at PPI, wrote in a blog post, just two companies controlling the lion’s share of the prison communications industry “will give facilities less choice and less ability to draft contracts that truly meet their needs.” According to reporting by the Marshall Project, if the deal is approved, prison systems in 47 states will contract with either Securus, Global Tel Link, or CenturyLink—and CenturyLink subcontracts nearly all of its contracts with ICSolutions or Securus.
PPI joined a number of prisoner advocacy organizations in filing a petition to deny the merger—but not merely because of the threat of a duopoly. They also argue that Securus routinely ignores regulations in order to maximize its profits (like when the FCC banned flat-rate fees on phone calls, and Securus changed the name of the charge to “first-minute” fees).
How will the Trump FCC rule on this? We can’t be sure yet, but let’s look to recent history: Last year, the administration approved Global Tel Link’s acquisition of Telmate, a company that had a market share just shy of ICSolutions’.