Telephone service providers offer lucrative commissions to states averaging 42 percent of gross revenues from inmates’ phone calls to obtain exclusive contracts for prison phone services, reports Prison Legal News. The contracts cost prisoners’ families a total of $152 million annually, indicating that the phone market in state prison systems brings in an estimated $362 million annually in gross revenue.
Prison Legal News, using public records laws, got phone contract information from all 50 states for 2007-08. About 30 states allow discounted debit and/or prepaid collect calls, which provide lower prison phone rates. Not all prisoners or their families have access to debit or prepaid accounts, so only collect calls – which are available in all prison systems except Iowa's – were compared. Also, while telephone companies sometimes provide reduced rates for evening and nighttime calls, many prisoners don't have the luxury of scheduling phone calls during those time periods.