How two companies came to dominate the prison phone call market : The Indicator from Planet Money When Diane Lewis' son, Jovaan, was sentenced to prison, she told him to call her every day. What he didn't know at the time is that those collect calls often meant Diane was unable to pay her other bills. Today on the show, how prison phone calls got so expensive, and the movement to make them free.

Related listening:
The Uncounted Workforce
From Prison to the Workforce
The Prisoner's Solution

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A captive market: The high price of prison phone calls

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SYLVIE DOUGLIS, BYLINE: NPR.

(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")

DARIAN WOODS, HOST:

This is THE INDICATOR FROM PLANET MONEY. I'm Darian Woods.

ADRIAN MA, HOST:

And I'm Adrian Ma. Before Diane Lewis' son went to jail, she had one instruction for him, call me every day.

DIANE LEWIS: When he went in, I started to think about everything I saw on TV. Like, oh, my God, they're going to kill him. He's going to be fighting all the time. He's going to be assaulted. He was 17, so I was afraid. I was really, really afraid.

WOODS: Her son, Jovaan Lumpkin, had been convicted of conspiracy to commit first-degree assault and had been sentenced to up to 12 years in adult prison.

JOVAAN LUMPKIN: Prison is a strange, strange environment, and you have to adapt in order to survive. And having people that love you and reminding you that, you know, you are a normal person and you are loved - it makes it manageable.

MA: Now, these calls were costing his mom hundreds of dollars a month. And what he didn't know at the time was for Diane to afford these calls, she would often skip meals or not pay the electric bill. In fact, she says, sometimes, she would be talking to Jovaan on the phone while she was at home sitting in the dark.

LEWIS: I can't imagine the phone being cut off with my son in prison. Like, that would be - I don't know if I would have survived that.

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WOODS: For most of us, the cost of making a phone call has never been cheaper, and yet for incarcerated individuals and their families, the cost of staying connected can be a huge financial burden.

MA: So today on the show, we explain how prison phone calls got so expensive and the growing movement to try and make them free.

In the early 1980s, the cost of prison phone calls were actually pretty comparable to calls on the outside because calls, in general, were expensive.

WOODS: Back then, AT&T had a monopoly on phone service. And the cost of a call varied a lot depending on how long it was, the distance, the time of day or week you called. For example, a ten-minute phone call from New York to LA would set you back more than $15 in today's money.

BIANCA TYLEK: You know, over the years in advancement with technology, naturally, those costs started to come down really significantly to the point that, like, you know, it's incredibly cheap to basically communicate now with people.

MA: Bianca Tylek is head of Worth Rises, a group that does advocacy on various criminal justice issues, including the cost of prison phone calls. She says the breakup of AT&T's monopoly created more competition and also helped bring down the cost of calls.

TYLEK: But in the prison space, that didn't happen. This niche industry moved in. And this niche industry moved in the exact opposite direction of, you know, broader telecom.

WOODS: That niche industry - providing phone service for prisons and jails.

TYLEK: And they did two things that were, like, super important to their survival. One is that they layered on security and surveillance services onto these calls and then, you know, basically blamed those services for the reason that they had to charge so much. And secondly, they agreed to share the profits that they received from these calls with the prisons and jails. And so there's no competitive negotiation that's happening there because they have a profit-sharing agreement.

MA: This last bit is worth emphasizing because the folks paying for those calls are the prisoners and, really, the prisoners' families. And because prisons and jails often get a cut of that revenue, they don't have much incentive to negotiate for lower prices. Also, because they only contract with one company at a time, the users, which is to say the prisoners and their families - they don't have a choice. Figuratively and literally, they are a captive customer base.

WOODS: One more important piece of the prison call puzzle is the role of private equity. That's something Bianca has been familiar with since her previous career as an investment banker.

TYLEK: I always sort of describe it as private equity does to companies what a house flipper would do to a house. They purchase something with a tremendous amount of debt, right? In the case of the house flipper, it would be a mortgage. In the case of a company, it's called leverage loans. And then they try to fix it up.

WOODS: Bianca says over the past couple of decades, that's what private equity firms have been doing with prison telecom companies - investing money to grow them and acquire competitors. And over time, that consolidation continued to the point where today two companies dominate the prison telecom industry. They're called Securus and ViaPath.

TYLEK: And that's how you get to this duopoly that we have of the industry.

MA: A nonprofit called the Prison Policy Initiative estimates these two companies own about 80% of the market. So all these different factors play a role in the high price of prison phone calls. When the Prison Policy Initiative looked at the cost of prison and jail calls in recent years, it estimated the price for a 15-minute call was somewhere 3 and $6, which is a lot considering that for just a few bucks more, you can get a cell phone plan with unlimited calling time.

WOODS: We reached out to Securus and ViaPath for comment. Both companies said they've significantly reduced their rates in recent years. They also said the cost of their service is justified because securely connecting people in prison to those on the outside requires specialized technology.

MA: But in the past few years, there's been a growing movement to make these calls less expensive. In 2020, the Federal Bureau of Prisons made calls from federal prison free initially as a COVID safety measure, but that policy has stuck around. And in the next couple weeks, the Federal Communications Commission is expected to announce national price caps on prison and jail calls. Both Securus and ViaPath say they're cooperating with the FCC on that.

WOODS: Meanwhile, advocacy groups like Worth Rises have been lobbying for change at the state level. In talking to lawmakers, Bianca cites research that suggests it's better for society when people in prison can stay in touch with family.

TYLEK: It improves reentry outcomes, ensuring people are more likely to be supported when they get home. They're more likely to have housing. They're more likely to have employment. And they're more likely to come home and stay home.

WOODS: Since 2021, at least five states - Connecticut, California, Minnesota, Massachusetts and Colorado - have passed laws making prison phone calls free for prisoners and their families. In these states, the government, i.e., taxpayers, cover some or all of the cost. The government has the bargaining power to negotiate a lower rate than what families were paying before. For example, Bianca says before Connecticut passed its law, families were paying upwards of $15 million a year to Securus and the state. After the new law with the state paying, the number of calls doubled, but the cost actually went down by two-thirds.

MA: Connecticut, by the way, is where Diane Lewis is from. We met her earlier. Nowadays, she's working with advocates like Bianca to raise awareness around this issue. And although Diane's son Jovaan got out of prison years ago, she hopes she can help others who have loved ones in lockup.

LEWIS: Do you know how hard it is to decide if you want to eat or talk to your son? That's a hell of a decision. Do you want light, or do you want to talk to your son? Now, guess what? Now they don't have to make that decision.

WOODS: Diane did make that decision to keep in touch with Jovaan when he was in prison. Today, Jovaan lives in Washington, D.C. He's got an apartment, a job and a small clothing business called Rise Again Wear. He says he isn't sure where he'd be today if it hadn't been for those daily calls.

LUMPKIN: Without some sort of connection to the normal world, the outside world, you could completely lose yourself in that environment. So I always had some sense of normalcy to remind myself that I'm not an animal. I may have to act like an animal at times, but I'm not an animal. So I always had that to kind of pull back on.

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MA: By the way, according to Worth Rises, lawmakers in almost a dozen states have introduced legislation to cover the cost of prison phone calls.

This episode was produced by Corey Bridges and Julia Ritchey, with engineering by Neal Rauch. It was fact-checked by Sierra Juarez. Kate Concannon is our editor. And THE INDICATOR's a production of NPR.

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