Feds may belatedly regulate rates on jail phone calls

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According to Bloomberg News ("Prison phone rate cuts considered by US regulators," Nov. 15), "U.S. regulators are considering ratecaps and other steps to lower jailhouse telephone rates." This primarily affects just two companies, because the nationwide market for jail and prison phone services:

is dominated by two private equity-backedcompanies, Global Tel*Link Corp. and Securus Technologies Inc.

Castle Harlan Inc., which owns Securus, declined tocomment, Michael Millican, a spokesman, said in an e-mail.Caroline Harris, a spokeswoman for Global Tel*Link ownerAmerican Securities, in an e-mail declined to comment.

The companies bid for exclusive contracts to providetelephone service, agreeing to pay as much as two-thirds ofcalling charges to government or private prison operators. Thosecommissions can drive fees to levels that make it difficult forprisoners to maintain contact with spouses, children andparents. ...

Global Tel*Link, based in Mobile, Alabama, has about 50percent of the correctional-phone services market, followed bySecurus with almost 30 percent, according to Standard & Poor’s. 

Dallas-based Securus Technologies, notably, is the company providing phone service to TDCJ. So Grits was interested to read that federal regulators appear primed to reduce the profit margins of this oligopoly:

U.S. regulators are considering ratecaps and other steps to lower jailhouse telephone rates thatenrich private equity firms as they cost U.S. prisoners andtheir families as much as $17 for a 15-minute call.

Federal Communications Commission Chairman Julius Genachowski yesterday proposed information-gathering that couldlead to a vote to intervene in the $1.2 billion prison-phonemarket, FCC Commissioner Mignon Clyburn said at a rally today.

“For far too long, friends and family of the incarceratedhave had no choice but to pay unconscionably high long-distancerates,” Clyburn told demonstrators seeking lower rates whogathered outside the agency’s headquarters in Washington.

Clyburn, like the chairman a Democrat, said the proceedingwas started by Genachowski and could lead to lower rates“soon,” without specifying a timeline. Rate caps are amongsteps being considered, said two agency officials who spoke oncondition of anonymity because the matter hasn’t been madepublic.

 Better late than never, is all Grits has to say about that.