Reading this and the companion article: Not sure if they're trying to push a narrative or if the authors really are this naïve, but this is how the world works for everything that isn't owned by...
These agreements hinged on an idea formally known as the "site commission contract," though critics often describe them using another word: kickback.
Unlike standard highest-bidder-wins contracts, in site commission contracts companies offer to share their revenue with facility operators. The result is a reverse-bidding system, in which the company that secures a contract isn’t the one offering the lowest price, but the one willing to share the highest percentage of its revenue.
Not sure if they're trying to push a narrative or if the authors really are this naïve, but this is how the world works for everything that isn't owned by the business that's housing the service. The vending machine at your job is there because the vending company offered the building the best contract. The condom/cologne machine in the truck stop bathroom, the legal-gray-area video slot machine at shady gas stations, the claw machine on the way out of the grocery store, the air machine at the gas station, and on and on. They're all there by the company that offered the business owner the juiciest contract. Payphones are no exception and is how we had places to put them and replaced other vendors during my tenure in the industry. That said...
Consider Alabama: a contract between the state Department of Corrections and CenturyLink meant that, by 2013, a 15-minute call from across state lines could cost more than $17. A 2013 contract in the state’s Baldwin county didn’t mince words, promising, in addition to an 84.1 percent commission on gross revenue from calls, "a guaranteed minimum average Commission of $55.00 per inmate per month."
...this is disgusting and not how the prison phones we had were contracted. However, we weren't a "prison payphone" company*, we were a normal payphone company that had a couple of prison contracts. Contracts were typically 25-33% of gross profits (coins in minus the telephone bill) for any payphone whether it was in a prison or on a street corner. We had actual payphones in prisons, not the steel box on a wall phones (like those pictured) that need an account. They phones did still make large amounts of money, enough that the techs I had on routes with prison phones would be instructed to drop everything and go straight to them if one of them went down (broke, inmate stuffed the coin slot with paper, etc.) as often enough the wall of prison phones alone would pay that tech's salary each month. We did program some restrictions into them depending on what the prison wanted. No incoming calls for example, only active during certain hours, no collect calls, and in one prison calls were limited to 10 minutes with no option to extend (by inserting more quarters) so when the call ended they'd have to start anew the idea being that the inmate would go to the back of the line and let the next inmate make a call, compared to the 15 minute call times (and extension) allowed on normal payphones.
*
Worth noting, that the payphone company I worked for was run by a father/son team. The father wasn't great, but wasn't a completely soul-less asshole like his son and had they/the son known that they could be doing things like this, he certainly would have. So our relatively nicer prison payphone service was out of lack of knowledge, not the goodness of the owner(s) hearts.
The National Sheriffs’ Association, a trade group representing law enforcement, largely agrees, writing in comments to the FCC that inmate calling rates are "misunderstood." Not only does a monopoly industry provide security, the association argues, but the exclusive contracts are a necessary way to fund a phone system.
The alternative to high rates isn’t lower rates, the association has suggested — the alternative is that phone calls in jails will be done away with entirely. "Absent these commissions," association president Larry D. Amerson wrote in a comment to the FCC, "counties would need to either increase taxes for the system or jails could potentially cease to provide inmates with this service."
Being that without shopping around or looking into bulk discounts, the price of a "prison phone" is about $300 and payphone landlines (a special category that a normal person cannot access) back when I was doing this were $15-30 per month depending on where they were, the cost of a prison providing the phones is miniscule. As is typical, the people getting the kickbacks can't come up with a single argument that isn't disproven by a simple google search and a little bit of experience.
Reading this and the companion article:
Not sure if they're trying to push a narrative or if the authors really are this naïve, but this is how the world works for everything that isn't owned by the business that's housing the service. The vending machine at your job is there because the vending company offered the building the best contract. The condom/cologne machine in the truck stop bathroom, the legal-gray-area video slot machine at shady gas stations, the claw machine on the way out of the grocery store, the air machine at the gas station, and on and on. They're all there by the company that offered the business owner the juiciest contract. Payphones are no exception and is how we had places to put them and replaced other vendors during my tenure in the industry. That said...
...this is disgusting and not how the prison phones we had were contracted. However, we weren't a "prison payphone" company*, we were a normal payphone company that had a couple of prison contracts. Contracts were typically 25-33% of gross profits (coins in minus the telephone bill) for any payphone whether it was in a prison or on a street corner. We had actual payphones in prisons, not the steel box on a wall phones (like those pictured) that need an account. They phones did still make large amounts of money, enough that the techs I had on routes with prison phones would be instructed to drop everything and go straight to them if one of them went down (broke, inmate stuffed the coin slot with paper, etc.) as often enough the wall of prison phones alone would pay that tech's salary each month. We did program some restrictions into them depending on what the prison wanted. No incoming calls for example, only active during certain hours, no collect calls, and in one prison calls were limited to 10 minutes with no option to extend (by inserting more quarters) so when the call ended they'd have to start anew the idea being that the inmate would go to the back of the line and let the next inmate make a call, compared to the 15 minute call times (and extension) allowed on normal payphones.
*
Worth noting, that the payphone company I worked for was run by a father/son team. The father wasn't great, but wasn't a completely soul-less asshole like his son and had they/the son known that they could be doing things like this, he certainly would have. So our relatively nicer prison payphone service was out of lack of knowledge, not the goodness of the owner(s) hearts.
Being that without shopping around or looking into bulk discounts, the price of a "prison phone" is about $300 and payphone landlines (a special category that a normal person cannot access) back when I was doing this were $15-30 per month depending on where they were, the cost of a prison providing the phones is miniscule. As is typical, the people getting the kickbacks can't come up with a single argument that isn't disproven by a simple google search and a little bit of experience.