Earlier this summer, the Federal Communications Commission (FCC) unexpectedly delayed implementation of its 2024 prison call order until 2027. The order, which was mandated by Congress and had bipartisan support in the agency and on Capitol Hill, sought to correct long-standing market distortions through a combination of cost-based pricing and competition-friendly rules. The delay was requested by incumbent providers and correctional facilities based on unexpected implementation challenges. But this postponement is unfortunate, coming right as new entrants such as Ameelio are poised to challenge those incumbents and perpetuating inefficiencies, high costs, and limited innovation in a sector ripe for disruption.

The prison telecom industry exemplifies market failure driven by misaligned incentives and lack of competition. The FCC has described this as a “unique marketplace” where incarcerated individuals have no choice in providers. Facilities award exclusive contracts, and have incentives to prioritize site commissions (payments from providers to correctional facilities) over service quality or affordability. The providers—two of which dominate the market—face little pressure to innovate or reduce prices. One study estimates that the average jail charges $3 for a 15-minute call, and the FCC has identified rates as high as $24.80. These unreasonable rates not only burden inmates and their families but also reduce communications with the outside world, which can increase recidivism and societal costs.

Historically, the FCC lacked authority to address this problem, as it lacked jurisdiction to regulate intrastate prison rates. Congress addressed this with the Martha Wright-Reed Act of 2022, which empowered the FCC to ensure “just and reasonable” rates across all Incarcerated People’s Communications Services (IPCS). The 2024 Order implemented this statute through permanent rate caps on audio services and temporary rate caps on video communications, derived from industry-wide average costs excluding non-essential expenses. Crucially, the agency prohibited site commissions, preempting conflicting state laws to eliminate perverse incentives. These reforms aimed to foster a competitive landscape by capping exploitative pricing and redirecting focus to efficient service delivery. However, the 2025 delay cites implementation hurdles, extending compliance amid concerns over safety tools and funding shifts, effectively preserving the distorted market for two more years.

Amid this ongoing dialogue in the policy sphere, new entrants like Ameelio have begun demonstrating how the IPCS market is primed for disruption. Ameelio is a Boston-based nonprofit that offers free or low-cost communications tools to incarcerated populations—not just audio and video calls, but email, educational programming, and reentry assistance. In Massachusetts, where the state has offered free calls to inmates since 2023, Ameelio’s digital literacy pilots, backed by a $4 million grant from the Massachusetts Broadband Institute, are teaching skills like online job searches and bill payments, reducing recidivism by easing reentry. By eschewing site commissions and capitalizing on modern technology, Ameelio claims to offer a better suite of services than incumbent providers for a fraction of the cost. This is a price point low enough for other states to consider following Massachusetts’ lead to publicly fund prison communications services.

Ameelio’s progress demonstrates that real disruption of the prison communications market is not only possible but already underway. By leveraging modern technology and rejecting the perverse incentives that have long plagued this industry, new entrants are proving that incarcerated individuals and their families can be served more fairly and at dramatically lower cost. By delaying its 2024 order, the FCC risks slowing this transition and entrenching the very inefficiencies Congress sought to correct. The result is two more years in which vulnerable populations will continue to shoulder inflated costs, even as better, more humane alternatives are waiting in the wings.