Spam and scam calls are more than just a nuisance—they’re actually the most common tactic used by scammers to commit fraud. Every month, two billion scam robocalls are made to U.S. phones. These calls aren’t just disruptive—they’re part of a massive fraud ecosystem that costs Americans billions of dollars each year. In 2023, it was reported roughly 60 million U.S. residents fell victim to phone scams, losing a collective $29.8 billion. Despite nationwide efforts to combat these calls, the reality is that the number of spam calls received hasn’t significantly decreased.

Here's what carriers don't want you to know: every spam call that goes through them generates revenue. When you pick up that spam call, various telcos involved in facilitating your call can get a cut. The process involves multiple providers, each earning a fraction of a cent per call. Although it seems minimal, with billions of calls each month, this adds up to a substantial income. And because it's a profitable model, telcos are slow to change or implement effective measures to truly combat spam calls.

The persistence of these calls can largely be attributed to how the telecom industry operates. Many Voice over Internet Protocol (VoIP—a technology that allows access to the telephone network through the internet) providers are honest businesses. However, because VoIPs are often small and can easily change names to avoid repercussions, they can be among the worst offenders, transmitting scam calls for a fee. Every answered call, even fraudulent ones, generates revenue not just for these smaller VoIP providers but for every telco in the call path—from the originating provider to the final recipient.

FCC Commissioner Geoffrey Starks summed up the issue: “Spam calls and texts will continue so long as those initiating and facilitating them can get away with and profit from it.” This statement highlights the fundamental problem: there is a financial incentive for providers to keep the calls coming, even if they are harmful to consumers.

The Government’s Response to Spam and Scams

In 2019, Congress passed the TRACED (Telephone Robocall Abuse Criminal Enforcement and Deterrence) Act, requiring the FCC to issue regulations to protect Americans against unwanted robocalls by authenticating caller IDs (known in the industry as STIR/SHAKEN), establishing a method to trace the sources of illegal calls, and requiring telcos to respond to requests for information about illegal calls. These measures, while well-intentioned, have not been sufficient to curb the flood of fraudulent calls. The primary reason is that telcos are only required to have “reasonable measures” in place to mitigate illegal robocalls, but not necessarily effective or meaningful procedures to actually stop scam calls. As a result, these calls continue to slip through the cracks, lining the pockets of the providers involved.

Here’s how it works:

• First, a foreign originating provider transmits an illegal robocall campaign and sends it over the internet to a U.S. based VoIP service—the gateway provider.
• Alternatively, a U.S. originating provider originates the call and sends it to a different U.S. based provider. Sometimes, however, calls may flow from the U.S. to foreign providers and then back into the U.S. in an attempt to hide the identity of the real originating provider.
• Typically, robocalls travel from smaller U.S. providers to larger U.S. providers, and then on to the terminating provider that delivers the call to the subscriber.
• In each transition from one provider to the next, the sending provider is charged something for each call by the receiving provider.

At Cape, our priority is your privacy—not profit.

For traditional telecom giants like AT&T and Verizon, who operate hundreds of legacy cell towers nationwide, their business isn't just about connecting calls; it's about generating revenue from every call that passes through their networks through a web of interconnection and roaming agreements. This means that their business model is reliant on the sheer volume of calls transiting their infrastructure, including unwanted spam traffic.

Cape is a modern, cloud-based telco provider focused solely on our customers. We don't profit from spam calls because our business is designed differently. We don’t convey calls for other telcos as an intermediary, which means our priority is your experience—not call volume. Our advanced spam filters block robocalls and unwanted messages before they ever reach your phone, providing network-level protections to put you in control of your communications.

At Cape, we're rewriting the rules by putting your privacy and control first. Switch to Cape today and enjoy a service built around you, not profits.