FCC May Finally Hit Predator Prison Phone Call Company, Thanks to Recently Passed Bill

The new law (awaiting the president’s signature) will allow the Federal Communications Commission to directly regulate costs in the notorious prison citation industry. Under the threat of having to provide solid products at reasonable prices, companies can choose to end the day and open the market to a generation of more compassionate and forward-thinking suppliers.

The prison citation system depends on the country and the prison system, and generally directs everything from good enough to bad enough. With a truly captive customer base, companies have no real reason to innovate, and financial models involving bribes to prisons and states incentivize revenue at all costs.

Inmates are routinely charged extortion fees for simple services such as phone calls and video calls (upsells), and even visitation rights are cancelled, leaving paid calls as the only option. Needless to say, this special financial burden falls disproportionately on people of color and people with low incomes, and it is a billion-dollar industry.

It’s been that way for a long time, and former FCC Commissioner Mignon Clyburn spent years trying to change that. When I spoke to him in 2017, before he left the agency, he called inmates “the clearest and most obvious type of market failure I’ve ever seen as a regulator.” It was a problem she worked on for years, but she gave much credit to Martha Wright-Reed, a grandmother who had organized and represented the struggle to bring reform to the system until her death.

And after Martha Wright-Reed, today’s bill is named. It’s a simple bill, inspiring the FCC with the power to “ensure fair and reasonable charges for advanced telephone and communications services in correctional and detention facilities.” This was done with some minor but significant changes to the Communications Act of 1934, which (among other things) established the FCC and was regularly updated for this purpose. (The bill passed the House and Senate and will almost certainly be signed by President Biden soon, as celebrations related to the spending bill, Volodymyr Zelenskyy’s visit, and Christmas speech passed .)

“Over the years, the FCC has moved aggressively to address this dire issue, but we have limited ourselves to the extent to which we can address tariffs for calls made within state lines,” FCC Chair Jessica Rosenworcel said in a statement. “Today, thanks to the leadership of Senator Duckworth, Portman and their bipartisan coalition, the FCC will be empowered to close this glaring, painful and damaging loophole in our jailed phone fare rules.” (He also thanked Wright-Reed, as well as Clyburn.)

Free Press has garnered a number of other comments from  stakeholders, all praising the law for curbing “prison speculation” and generally benefiting inmates rather than continuing to treat them as an easy source of labor or money.

While it’s great that costs go down as soon as the FCC can draft and issue rules on the issue, the effect is likely to outweigh the savings.

Most existing businesses today will inevitably face greatly reduced revenue as oversight increases, as the FCC requires reporting and takes other actions it decides are necessary to enforce the new rules. No wonder at all that many of these companies are out while being good.

The introduction of regulation in a space like this, dominated for years by longtime providers, could lead to a change of custodian, something we’ve seen before with some states adopting new models like Ameelio. The startup started as a way to deliver postcards to inmates for free, but they soon built a modern digital video calling infrastructure that was much cheaper and easier to operate than the previous one.

Now operating in three states, Ameelio’s services can also serve as a base for activities such as education and legal advocacy in prison facilities, as they are much lower in cost and easily accessible. (As indeed invented by the founders, and later discovered Emerge Career.)

A group of shady companies rushing to leave market opportunities means countries are rushing to find suppliers, no doubt Ameelio will be looking to fill some of those gaps, but in the coming years other companies are likely to participate as well.

The prison system we have is in dire need of reform in general, but it will happen piece by piece, as we see happening here.