The Shadowy Industry Dedicated to Squeezing Every Last Penny out of People in Prison
This is part of Time, Online , a Future Tense series on how technology is changing prison. When it comes to the technological advances that have graced our ever-expanding, ever-crowded, ever-exploitative prisons, observers rightly tend to point out the insidious panopticon they've enabled: sophisticated surveillance and security networks that ensnare the lives of nearly 2 million people locked up throughout the United States. But the technology that prisoners themselves use and depend on is frequently overlooked. Those very tools, proffered as a lifeline, often become another means of punishing both incarcerated people and their communities, largely because the profiteers from this multibillion-dollar sector prefer to keep it that way. Through partnerships with private prisons and contracts with state-helmed correctional institutions, name-changing private equity firms have come to dominate the provision of essential digital services to American prisoners. Just a few companies control prisoners' access to phone and video calls, educational resources, data storage, music and podcasts, word-processing software, and messaging platforms—resources that people on the outside use every day. If you're in prison, chances are that a private firm largely controls not only whether you're able to use anything from that list, but how much you'll pay for it. A necessity to the incarcerated becomes yet another lucrative scheme that victimizes the very people it professes to help. Advertisement To understand how this came to be, it's worth homing in on the story of one significant, all-but-duopolized sector: prison communications. For most of the 20th century, landline phone service across the United States—including prison pay phones—was dominated by AT&T's regulated "Ma Bell" monopoly, which covered long-distance calls and regional networks through the buildout of self-manufactured infrastructure. This changed in 1982, when a government antitrust suit forced the company to spin off its regional networks and shutter its equipment-assembly arm, leaving AT&T with only its long-distance lines for the next couple of decades. (The company would re-merge with many of its former Bell subsidiaries by the mid-2000s.) Advertisement Advertisement That breakup sparked a land grab from extant telecommunications competitors like Sprint, Pay Tel Communications, MCI Communications, and former AT&T subsidiary SBC, which hungrily eyed new openings in regional phone service—including the state and municipal prisons whose connections fell under local oversight. These newly empowered competitors then turned to offering prisons what the onetime gatekeeper could not: novel computerized features like electronic messaging and intelligent networks. "They had these surveillance features, and they started to engage in commissions-based services, where they would make profit-share arrangements with prisons," said Bianca Tylek, founder and executive director of the anti-carceral nonprofit Worth Rises. Advertisement Advertisement In other words, these companies weren't selling just phone calls. They were also selling improved ways to monitor and track those calls— and taking a cut of the fees that prisoners and their loved ones were charged for making them. It was good business: By 1995, nearly 90 percent of the country's prisons shared some profits with private telecoms firms. A survey from the time, published by the American Correctional Association, found that 31 corrections departments raked in about "$96.4 million in commission revenues from inmate telephone calls." Advertisement The '90s brought even more governmental boons to the thriving prison-comms industry. First, of course, came Bill Clinton's 1994 crime bill, whose sentencing revisions helped to accelerate the growth of the national prison population, already booming thanks to a surge in recent "tough-on-crime" state laws. Then came the 1996 Telecommunications Act, which allowed for increased competition in the pay phone market. That wasn't a bad thing for the broader market, but prisons had unique bargaining advantages over other telecoms clients: A whole state's correctional department could field bids from companies jockeying to provide the pay phones and the calling bandwidth and those aforementioned surveillance options for all state facilities. Of further benefit to these facilities and their contractors: a 1996 crime-bill amendment that authorized states to use federal grants to turn prisons over to the private sector, legislation that helped to open up telecoms markets to fellow profit-seeking incarcerators. Advertisement Advertisement Advertisement Two years later, Eric Schlosser laid out one example of the ensuing "prison-industrial complex" in a damning Atlantic report: "The business has become so lucrative that MCI installed its inmate phone service, Maximum Security, throughout the California prison system at no charge. As part of the deal it also offered the California Department of Corrections a 32 percent share of all the revenues from inmates' phone calls. MCI Maximum Security adds a $3.00 surcharge to every call." Even these eye-popping fees did not necessarily come honestly: MCI was caught overcharging in one state by automatically "adding an additional minute to every call." The burden of these above-market rates fell largely on incarcerated people's loved ones, who petitioned authorities in states like Connecticut and Oklahoma to do something about unreasonable prices for these phone calls, which varied widely among facilities. In 2000 Martha Wright-Reed, whose grandson was incarcerated, filed a federal lawsuit over the nature of the phone contracts; that suit was referred to the Federal Communications Commission and languished there for over a decade. Advertisement At the same time, bigger-picture telecoms firms were slowly getting squeezed out of the prison space by two '80s-era Southern companies that specialized in inmate calling: T-Netix (which provided tech for calls and for information management) and Global Tel*Link Corporation (which offered commerce systems and in-call voice recording). Advertisement Advertisement Throughout the 2000s, these "Big Two" were on a roller coaster of investments and acquisitions. In 2004 T-Netix was acquired by the private equity firm H.I.G. Capital, which in turn acquired the telecoms company Evercom and merged the two companies into an entity it dubbed Securus Technologies. That same year, the international private equity juggernaut Gores Technology Group acquired Global Tel*Link, aka GTL, from its parent company, Schlumberger Technologies. Private equity firm Castle Harlan purchased Securus from H.I.G. in 2011 for $440 million, then sold it two years later to ABRY Partners for $640 million, which then sold it to Platinum Equity in 2017 for around $1.5 billion. As for GTL, it was first purchased by PE firms Veritas and Goldman Sachs Direct in 2009 for $345 million, then acquired by American Securities in 2011 for $1 billion. Advertisement Advertisement By 2012, GTL, Securus, and competitor CenturyLink Public Communications accounted for 90 percent of the inmate phone services market. (In 2020, after the FCC approved CPC's acquisition by Inmate Calling Solutions, the latter took the former's place as distant PE-owned runner-up to the GTL/Securus duopoly; the PE major Keefe Group owns ICSolutions.) Advertisement Why did private equity firms flock to this space and provide backing to these corporations? As Worth Rises' Bianca Tylek told me, prison telecoms operated in a market structure that was amenable to private equity firms' key demand: to squeeze out as much money as possible in order to earn sky-high returns as a company investor or to juice business value upon resale. Privatized prison services like phone calls, which are cheap to install and network, attracted little in the way of regulation or active oversight in the years following the AT&T breakup and the '96 telecoms act. Plus, as Wanda Bertram, a communications strategist at the Prison Policy Initiative, told me, private equity finances tend to be murky. That's to their advantage—as Tylek told NPR in 2020, American Securities' purchase of GTL was financed in part by public pensions, including the official fund for Los Angeles Firemen and Police, which obviously has a vested interest in the prison system. Advertisement What makes all this even juicier for private equity is the fact that prison comms contracts give companies systemwide monopolies—incarcerated people and their families can't choose a different service if they don't like what's offered in their prison. Companies "have an exclusive right to provide services, so they're not in competition, which means they can provide shitty services," Tylek said. PE capital, in turn, allows their portfolio companies to grow in perpetuity by gobbling up competitors—and the Big Two have certainly done that. From 2012 through 2018, as Securus' own website documents, the firm bought about a dozen other companies, covering services like videoconferencing, GPS monitoring, biometric analysis, electronic messaging, and even music streaming. GTL (now called ViaPath) is no slouch, having procured for itself at least three rival prison-communications firms, a video-software provider, a payment services app, and an ed-tech system from 2010 through 2017. Advertisement Advertisement Advertisement Advertisement That gets into another key part of the prison comms industry: its rapid diversification away from simple phone calls. In part, that was a response to regulations from the Obama-era FCC, which reexamined Martha Wright-Reed's lawsuit and issued new caps on per-minute pricing for collect calls and interstate prison calls. (The rules were approved with a dissenting vote from then-Commissioner Ajit Pai, who'd previously represented telecoms giants like Verizon, AOL, and Securus as a private attorney.) In 2015 the agency went further by passing rate caps on all prison phone calls and abolishing ancillary service fees, such as charging for the mere act of establishing a company account. Again, Pai dissented—and two years later, when he became FCC chairman and the 2015 regulations were tangled up in a telecoms-sector lawsuit, he refused to defend those particular rules in court, and they were subsequently struck down. Advertisement These regulations were enough to push companies like Securus and GTL to pivot away from their once-lucrative moneymaker of phone calls into other digital communications. Remember all those other companies they acquired? Well, they began putting them to work, providing: video-calling capacity, which often means that prisons will subsequently restrict or end in-person visits altogether; electronic messages, often with time limits on reading and steep "digital stamps" that cost over 20 cents a message (and prompt jails to do away with physical mail); and "free" e-tablets with preloaded pay-to-use media, among other services. Advertisement There is, however, a dim light at the end of the tunnel: Earlier this year, President Joe Biden signed the Martha Wright-Reed Act, written and approved by a bipartisan group of Congress members to instruct that the FCC "ensure just and reasonable charges for telephone and advanced communications services in correctional and detention facilities." Before that, a few states began to pass laws abolishing prison-calling fees. Connecticut, the first, went so far as to end surcharges on video calls and emails as well. Advertisement Advertisement But private equity still has carceral bounties at hand. The consolidation of communication necessities into one specialized corporation only increases that company's net worth, overhauling both revenue structure ("Four years ago, Securus' revenue was 60 percent phone calls, 40 percent everything else, and now that's flipped," Tylek said) and future prison deals ("They typically contract for a bundle of services, including phone calls, video, tablets, and maybe 'inmate banking,' " Bertram said). Related From Slate
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In Prison, Out of Googles
Read More This has also inspired rebranding: In January 2022, GTL changed its name to ViaPath, adopting a sunnier logo, committing to "breaking the cycle of incarceration," and renewing a focus on its ed-tech subsidiary, which approved and then retracted a controversial grant for incarceration-focused children's materials to Sesame Workshop (the production company behind Sesame Street). In 2019 Securus' private equity shareholders announced a restructuring that would transform it into a "diversified technology company," splitting off its phone services from its money-transferring arms and couching them all under a parent company called Aventiv Technology. In 2020 it began providing customer-service lines to friends and family of the incarcerated (and, recently, Black Friday deals!); in 2022 it hosted a stunningly cynical rap-writing contest for incarcerated contestants. Advertisement Advertisement Advertisement I say "stunningly cynical" because one of the big reasons there's now more public momentum and policy action against the prison-communications sector is because creatives behind bars have long made the most of its janky tech to express themselves and distribute their work far beyond cell walls. Like, well, rappers—folk-hero tales abound of artists locked up in the middle of their careers (Mac Dre, Gucci Mane, Max B) who spoke their verses into clunky phone receivers so as to transmit them to ingenious friends on the outside. One of them, the late Drakeo the Ruler, didn't hesitate to call out the company wiring his raps: 2020's Thank You for Using GTL included the automated titular message in nearly every song, making sure listeners couldn't forget. Drakeo later told NPR that the collective expenses of putting together a jail-phone-recorded album added up to "the hundreds of thousands. … It's crazy how much they charge to do this." Advertisement Advertisement Of course, GTL and Securus became characters even beyond the rap realm: as Adnan Syed's $2,500 tool for recording his Serial dispatches, and as the playthings of private equity executives who also happen to own NBA teams. Their text-focused and commissary subsidiaries are also invaluable for incarcerated journalists and writers getting their work to the public—which makes it all the worse that these products, despite all the cash they collect, continue to peddle fragile, unreliable, treacherous service. Securus, in particular, has become notorious for a few events: stowing recordings of attorney-client calls while failing to bolster protections against massive hacking operations; forcing Florida contractors to switch out prisoners' MP3 players for new tablets from its JPay subsidiary, fueling a mass loss of listeners' music collections; installing a 2021 software update that temporarily removed copy-and-paste and message-drafting functions from JPay tablets' word processors; and, most recently, mass-deleting drafts from its e-messaging app for Washington state's incarcerated, causing these occupants' writings to fall into an unrecoverable void. Advertisement - My Dog Was Fine on a Friday—and Dead by Tuesday. A Specific Concept Has Helped My Grief
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The state of modern-day prison communications demonstrates just one knotty example of the tentacles of in-prison technology. Yet its very existence also points to a way out of this panopticon. The constant political lobbying against these companies from family members of prisoners and the organizations that support them; the resulting, concrete government laws and regulations, at both the state and federal level, that pushed those firms into changing their strategies; the nationwide uprisings against carceral cruelty that spurred companies like Securus and GTL to rebrand themselves and publicly adopt the language of restorative justice; the constant public attention brought to this heretofore obscure industry, by rappers and podcasters and journalists who may themselves be behind bars—all of it is slowly adding up to make indelible change in an industry that has long resisted any accountability. It's not enough, and there's still a long way to go. But it's a promising start that points to other paths we can take toward humanizing our greedy justice system just a bit more. Future Tense is a partnership of Slate, New America, and Arizona State University that examines emerging technologies, public policy, and society.
