The world of prison profiteering is expanding. As the FCC cracks down on expensive prison calling rates, companies move into video chat instead.
An article about the JPay / Securus merger was published by Bloomberg last week, showing how the recent merger is expanding the prison profiteers influence, and attempting to undercut the long-fought victory won by the Prison Phone Justice campaign to protect prisoners and their families with fair FCC regulations.
The article is below:
The Internet communication revolution is being mirrored, in funhouse form, inside American correctional facilities. Companies that have historically focused on prison phone services that connect prisoners to loved ones and lawyers are now branching into video chats.
Earlier this month, Securus, one of the two biggest prison phone companies, bought JPay, a company that started as a money transfer service for prisoners and has since expanded into video visitation. This comes less than a year after Securus’s main competitor, Global Tel-Link, acquired another provider of prison video chats, Renovo. Now critics fear that the wider rollout of video calling could eliminate in-person prison visitation and cause skyrocketing costs for prisoners and their families.
The prison phone industry is already facing increased scrutiny of its cost structure. In September 2013, the Federal Communications Commission (FCC) released an analysis of prison phone rates. It found that inmates and their loved ones have been forced to “subsidize everything from inmate welfare to salaries and benefits, states’ general revenue funds, and personnel training” to pay for calls. About 40 percent of the fees go to prison phone companies, according to the Prison Policy Initiative (PPI), an advocacy and research organization focused on criminal justice.
The FCC put temporary caps on interstate calls in 2013, decreasing rates for a 15-minute call from over $17 to a maximum of $3.75. It’s considering more fundamental reform, like standardized lower rates nationwide, which would significantly dent the revenues of companies like Securus and Global Tel-Link. (Securus Chief Executive Richard Smith told Bloomberg in January 2014 that the company would “continue to fight for prisons and jails to fight for the prices that they deem are necessary to support their own prisons and jails.”) It is expected to issue a decision within months. PPI says it’s unlikely that the FCC will issue rules for video chats.
Prison phone companies appear to be prioritizing video visitation. Securus, for instance, currently offers the service at 140 county jails nationwide, according to its website. PPI estimates that about 500 jails and prisons in 43 states and Washington, D.C., are experimenting with video visitation.
Prisons use two types of video chat. In one, visitors sit at a bank of video terminals and chat with inmates in the same building, which is generally free. In the other, prisoners or their families pay to communicate remotely through Internet chat.
Companies often offer both services as part of a single contract. But they push the latter option because it translates directly into revenue, according to advocates and officials at correctional facilities. And according to the PPI, video visitation is being used not to supplement in-person visitation, but to eliminate it completely. While state prisons are unlikely to do this, about three-quarters of county jails with video visitation have gotten rid of in-person visits. The group says that Securus is unique, because its standard contracts require that facilities eliminate face-to-face visits. Because JPay’s clients are state prisons, PPI says it’s worried the merger will cause practices that are common at the county level to move to the states.
Securus has defended its push for remote video chats. As part of its bid for a contract with Dallas County, Texas, the company argued that changes to the system’s current visitation practices were necessary to sustain its business. “The capital required upfront is significant and without a migration from current processes to remote visitation, the cost cannot be recouped nor can the cost of telecom be supported,” the company wrote. Securus also argues that remote visitation is a better deal for inmates’ families, once transportation costs and other factors are considered. “Family members can avoid crowded waiting areas, personal searches, and stressful situations by staying home,” it writes on its website.
Securus’s contracts generally set a rate of $20 per 20-minute session for remote video calling, plus fees, surcharges, and taxes, although the company doesn’t always charge that much, according to rates posted on its website. JPay, by contrast, charges about 30 cents per minute, and prisons that use JPay aren’t barred from continuing in-person visits, according to Peter Wagner, the executive director of the Prison Policy Initiative. He says he’s concerned that Securus’s increased market power will turn its policies into the industry standard. “[JPay’s] customer service was pretty good, some of their pricing was reasonable, and they actually responded to public pressure and would push states to improve existing contracts,” he said. “That is the complete opposite of how Securus operates.” Securus and JPay both declined to comment for this article.
In Denton County, Texas, Securus in 2013 entered a contract in which the company would exclusively provide fee-based phone, instant mail, calling card, debit, and other services to inmates detained at the local jail. The prison eliminated in-person visits four months later. A class-action lawsuit filed last month in Denton County court by family members of inmates at Denton County Jail accuses Securus of compelling the county to eliminate in-person visitation. Securus is “the sole provider of every available visitation service in Denton County,” the lawsuit reads, and thus “has no incentive to provide a satisfactory experience for those compelled to submit to their terms.”
Securus may have no direct competitors in Denton County, but nationwide it’s a two-company race between Securus and Global Tel-Link. The companies regularly end up on opposite sides of lawsuits; each has sued the other for patent infringement and for issuing allegedly defamatory press releases. Global Tel-Link is currently challenging nine of Securus’s patents at the U.S. Patent and Trade Office.
Global Tel-Link jumps at the chance to paint its main competitor as the industry’s troublemaker. David Henion, the company’s vice president for video visitation sales, points out that none of Global Tel-Link’s contracts require facilities to do away with in-person visitation.“[Securus’s practices are] going to taint the whole landscape,” he says. “There’s going to be a kind of stigma around video visitation, as a negative way that big companies are trying to get money from the poor.”
But Global Tel-Link’s clients often ban face-to-face visits once they start using video visitation. The Prison Policy Initiative identified 26 county jails that contract with the company, and has determined that video visitation led to the elimination of face-to-face visits in nine out of 10 cases the group has closely examined. It’s not clear in every instance why that’s happened, and Global Tel-Link says jails have eliminated face-to-face visitation without coercion. “We don’t mandate it,” says Henion. “If the facility finds that, policy-wise, that’s what they’re going to do, that’s what they’re going to do.”
Jailers don’t always need to be coaxed into eliminating visiting hours. The county jail in Peoria, Illinois, is one of Global Tel-Link’s clients. Historically, jail officials have had a tough time managing visiting hours, says Brian Asbell, the county’s superintendent of corrections. During visiting sessions, several hundred people would pack into the lobby, waiting for 15-minute visits with friends and family. Fights were common, says Asbell, and visitors were often arrested themselves. In 2010, Peoria replaced in-person visits with video visits from Renovo, which was later purchased by Global Tel-Link. The jail extended visiting hours after implementing video visitation, and was able to move visitors through with fewer problems. “In my tenure it’s one of the best decisions we did,” Asbell says. “I love it, as a former detective. They’re all recorded, too. You have that as a means of investigation.”
Administrators and public officials are making similar decisions in jails nationwide, but critics say their options are being narrowed by companies looking to maximize returns. Paul Wright, an ex-convict and editor of prisoner-rights newspaper Prison Legal News, says the companies are gaining more power over prison policies with each new business they expand into. “These companies already have a kickback model established with their prison phone contracts. So it’s easy to leverage those contracts into video visitation, money transfer, access to e-mail and other information — whatever,” Wright says. “What we’re looking at isn’t a monopoly but an oligopoly. And these companies will do whatever they can to increase their share.”