DealBook Briefing: The Inside Story of How Walmart Won Over Flipkart


Today’s DealBook Briefing was written by Andrew Ross Sorkin in New York, and Michael J. de la Merced and Amie Tsang in London.



Michael Cohen

Brendan McDermid/Reuters

How Michael Cohen made $2 million as a gatekeeper

He didn’t join the White House. But President Trump’s fixer brought in huge payouts from Squire Patton Boggs, AT&T, Novartis and others with the prospect of access to power.

Among the latest revelations:

• AT&T told employees that it paid $600,000 for antitrust insight into antitrust matters as it sought backing for its $85.4 billion takeover of Time Warner.

• Novartis was worried about Mr. Trump moving against the Affordable Care Act and promising to cut drug prices.

• Mr. Cohen helped Squire Patton Boggs land a client: U.S. Immigration Fund, which connects American businesses with foreign investors and which the WSJ says has ties to Kushner Companies.

He sought those clients out, according to Michael Avenatti, Stormy Daniels’s lawyer.

Some White House critics, like the Democratic senator Brian Schatz, snarked about it all:


Mr. Cohen’s self-assessment in 2017, according to the WaPo: “I’m crushing it.”


The latest fallout from Trump’s foreign policy

In Mexico: President Trump’s antagonism has lifted Andrés Manuel López Obrador, a Trumpian presidential candidate who unnerves corporate leaders, according to Bloomberg Businessweek’s latest cover story.

In Iran: Oil prices changed little after Mr. Trump withdrew from the nuclear deal, but businesses are watching how tightly his administration enforces renewed sanctions. Boeing, which stands to lose a $20 billion deal, has played down the impact.

In China: Sanctions have put ZTE, once one of the country’s most successful tech companies, at death’s door. One analyst cautioned: “In the long run, strategically, this might be worse for the U.S. than the current situation.” Meanwhile, Beijing is reportedly looking for potential U.S. imports to avoid a trade war.

The political flyaround

• Democratic senators asked Carl Icahn and Scott Pruitt to explain how the Icahn-owned CVR Energy won exemption from a biofuels law. (Reuters)

• Automakers who wanted looser regulations fear the Trump administration may go too far. (NYT)

• Mick Mulvaney has shifted the C.F.P.B.’s student loan unit into its consumer information division, potentially sidetracking an investigation into the lender Navient, and irritated former colleagues in Congress by asking them to reduce their expenses.

• President Trump wants pharmaceutical companies to charge more abroad to cut prices in the U.S. The plan, like other administration policies on the drug industry, has strong critics.


Eric Schneiderman

Mary Altaffer/Associated Press

How fierce will New York’s next attorney general be?

Eric Schneiderman went after big banks for mortgage abuses and fought the Trump administration on environmental rules. Whoever replaces him must decide whether to follow in his litigious footsteps.

His interim replacement, Barbara Underwood, said she plans to continue that work, though less aggressively. The first test may an investigation into whether Exxon Mobil misled shareholders about climate change.


Dominic Parton, global managing partner at McKinsey.

Gian Ehrenzeller/EPA, via Shutterstock

The legal issues flyaround

• Jay Alix, a prominent restructuring specialist, sued McKinsey & Company, accusing it of misleading bankruptcy courts about conflicts of interest. (NYT)

• NBCUniversal’s legal team — with unusually little help from outside lawyers — cleared NBC News executives of wrongdoing in their handling of Matt Lauer. (NYT)

• Royal Bank of Scotland agreed to pay $4.9 billion to settle with the Justice Department over the sale of toxic mortgage-backed securities in the lead-up to the global financial crisis. (WSJ)

• Wells Fargo acknowledged pocketing fee rebates that it should have passed on to a public pension fund in Tennessee. (WSJ)

• Wu Xiaohui, who founded Anbang of China, was sentenced to 18 years in prison for fraud. (NYT)


Rifles at a Sturm Ruger factory.

Eric Thayer/Reuters

Gun control activists (and nuns) score a win at Sturm Ruger

For weeks, the gun maker had urged shareholders to reject a proposal by nuns demanding more transparency on plans for safer firearms. But investors sided with the nuns, ordering Sturm Ruger to prepare a report on how it tracks violence tied to its products and information on its research into so-called smart guns.

Sturm Ruger’s C.E.O., Christopher Kilroy, played down the significance of the move, saying: “That’s it, a report.” And a former N.R.A. executive, Sandra Froman, won re-election to the board.


Lucas Jackson/Reuters

Why Fox struck a deal while it waits for Disney and Comcast

Though 21st Century Fox may increasingly regard Sinclair Broadcasting as a rival, the transaction that they announced yesterday — where Fox will buy seven stations from Sinclair and Tribune for $910 million — makes sense. Fox has wanted to own more of its local affiliates, while Sinclair needs to satisfy antitrust regulators.

Meanwhile, Fox’s quarterly earnings announcement yesterday shows why Disney and Comcast are hungrily eyeing its assets, says Tara Lachapelle of Bloomberg Opinion.

Elsewhere in deals: Sears shareholders loved the its agreement to install tires for Amazon customers. The U.S.-based Stealth BioTherapeutics reportedly plans to go public in Hong Kong. The Asmodee Group, the game company behind DealBook favorite Settlers of Catan, is reportedly considering selling itself for more than $1.7 billion. How Goldman Sachs got stuck on a bad Burberry trade. SoftBank’s Vision Fund has found more investors.

The speed read

• Qatar’s sports network is being bootlegged on a remarkable scale, probably as part of a Saudi-led blockade. (NYT)

• FIFA met with seven leading soccer teams to pitch an expanded Club World Cup. (NYT)

• California became the first state to require all new homes to have solar power. (NYT)

• A new bill in Germany could allow collective lawsuits for the first time. (WSJ)

• Voice systems like Siri and Alexa will obey orders inaudible to humans, researchers have shown. (NYT)

• Meet Japan’s Bitcoin king, who has been scooping up financiers from his old employer, Goldman Sachs; and Silvergate Bank of San Diego, a community lender that has become a go-to for the cryptocurrency industry.

• Ev Williams, of Blogger, Twitter and now Medium fame, has a manifesto for fixing the internet. (NYT)

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Microsoft Tries a New Role: Moral Leader

But while the company’s power has diminished since a couple of decades ago, when it controlled computing through Windows, Microsoft remains an influential voice. On Monday, its market capitalization of $733 billion made it the third most valuable technology company, behind Apple and Amazon and ahead of Google parent company, Alphabet, and Facebook.

“The irony for Microsoft is that they lost in search, they lost in social networks and they lost in mobile, and as a consequence, they have avoided the recent pushback from governments and media,” said David Yoffie, a professor at the Harvard Business School. “This has given Microsoft the freedom to take the high road as the ethical leader in technology.”

Since taking the reins at Microsoft in 2014, Mr. Nadella has brought a more sensitive style of leadership to the company than his two predecessors, Steve Ballmer and Bill Gates. That shift has proved to be more suitable for Microsoft in this era.

Two decades ago, Microsoft was depicted as a bully that ran roughshod over competitors in a landmark antitrust suit brought by the federal government, followed by similar cases brought by the European Union and private companies. Mr. Smith was brought in to make peace in Microsoft’s antitrust battles, and Mr. Nadella was the company’s first chief executive to start in the job since those suits were settled.


“We need to ask ourselves not only what computers can do but what computers should do,” Satya Nadella, Microsoft’s chief executive, said on Monday at the company’s developer conference in Seattle.

Kyle Johnson for The New York Times

In a phone interview, Mr. Smith, who is also Microsoft’s chief legal officer, called its legal problems in past decades a “gut-wrenching experience” that had shaped Microsoft in its current form. “It made Microsoft a better and more responsible company,” he said.

This year, Microsoft published a book that outlined some of the harmful effects that could come from artificial intelligence, such as bias in job recruiting. It has litigated four lawsuits against the United States government over the past five years in efforts to defend customers’ privacy rights. One of them, a fight over law enforcement access to data stored in an overseas Microsoft data center, went to the Supreme Court, which dropped the case after Congress enacted a law that mooted it.

“Not only did Microsoft learn from its mistakes, Satya is a unique and caring individual,” said Tim O’Reilly, a tech industry publisher and conference organizer. “He understands deeply that Microsoft must help others to succeed.”

The closest analog among Mr. Nadella’s peers is Tim D. Cook, the chief executive of Apple, who has painted Apple as a staunch defender of its customers’ privacy. He has jabbed at Facebook and Google, both advertising-supported businesses that profit from the personal data they collect from their users, a contrast to Apple’s business model of selling devices.

Facebook and Google, which owns YouTube, have defended their advertising businesses for allowing them to deliver services for free. They’ve promised to add more human moderators and invest in software tools that can screen out misinformation and other prohibited content.

Mr. Cook has not turned his ire toward Microsoft, which gets most of its revenue from software, hardware and cloud computing services. The company has investments in internet services that are supported in part by advertising, including its Bing search engine and LinkedIn, the social network for professionals it acquired in 2016.

Mr. Nadella has been more hesitant than Mr. Cook to publicly criticize other technology companies, turning to more subtle types of persuasion. A low-key leader, Mr. Nadella peppers his speeches and interviews with references to literature, warning that careless creators of technology could contribute to a dystopian world of George Orwell’s “1984” or Aldous Huxley’s “Brave New World.” His lieutenant, Mr. Smith, has become a ubiquitous ambassador for Microsoft on the big social issues facing technology in Washington, in Brussels and on the conference circuit.

Microsoft is still occasionally cast in the role of villain. A California man who sold recycled electronic waste recently pleaded guilty for creating thousands of unauthorized discs that helped people restore the Windows operating system on refurbished PCs. The recycler, who has been sentenced to 15 months in prison, has said Microsoft supported the case against him, which was brought by federal prosecutors, because he threatened part of its business. Microsoft published a long blog post that portrayed his actions unfavorably.

Still, the Microsoft of 2018 is a long way from the company that was once portrayed as a corporate predator.

“Microsoft lived through negativity that these companies are experiencing now, and it doesn’t want to go back to those days,” said Vivek Wadhwa, a distinguished fellow with Carnegie Mellon University’s Silicon Valley campus.

Mr. Smith of Microsoft said the greater scrutiny on the tech sector would not always fall on the same companies.

“At any given moment, there may be one or two companies in the spotlight,” he said. “I don’t think one should assume the same one or two are always going to be in the spotlight or always on the defensive.”

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Berkshire’s Annual Meeting: Buffett Approves of Apple’s Buyback Plan

Berkshire owns more than 60 businesses. Women are chief executives at six of those businesses, and the Berkshire-owned Ben Bridge Jeweler named Lisa Bridge as president late last year to run the jeweler’s day-to-day operations.

“I feel very good about the decisions we’ve made about our C.E.O.s,” he added.

He did not answer whether Berkshire would push for gender equality on the boards of the companies that Berkshire is invested in.

Mr. Buffett also said it was clear that women had been treated unfairly in the past.

“I have two sisters who are absolutely as smart as I am, and they have better personalities,” he said. “They didn’t remotely have the same opportunities as I had.”

Mr. Buffett said there was still a “pipeline problem” in corporate America, making it hard to find as many qualified women to lead companies.

But, he added, “you can’t use that excuse forever.”

— Emily Flitter

Buffett approves of Apple’s buyback plan.

Berkshire is quickly building its stake in Apple.

Since Berkshire first invested in the iPhone maker about two years ago, the stake has grown into Berkshire’s largest holding. At the end of the first quarter, Berkshire owned $40.7 billion of Apple’s shares, up from $28.2 billion at the end of 2017.

So what does Warren Buffett think about Apple’s announcement that it plans to buy back $100 billion of its shares?

“I’m delighted to see them repurchasing shares,” Mr. Buffett said. “We own 5 percent of it. With the passage of a little time, we may own 6 or 7 percent because they repurchase shares.”

Charles Munger added that he and Mr. Buffett don’t approve of every buyback plan, but he doubted Apple would find an acquisition target at a good price.

“The reason companies are buying their stocks is that they are smart enough to know it’s better for them than anything else,” Mr. Munger said.

What about Microsoft?

Given Berkshire’s investment in Apple, one shareholder wanted to know why Berkshire never invested in Microsoft. The question came with Bill Gates, Microsoft’s co-founder and a director at Berkshire, sitting in the audience.

“In the earlier years, the answer is stupidity,” Mr. Buffett replied. But then Mr. Buffett added that his friendship with Mr. Gates has grown over the years, and he has stayed away from investing “because of the inference” that could be drawn.

And Amazon and Alphabet…

Mr. Buffett has famously avoided investing in tech companies because he didn’t understand them. But one investor wanted to know if Mr. Buffett’s stance is evolving. Beyond Apple, the questioner pointed out that Amazon and Google parent Alphabet have the characteristics of companies Mr. Buffett typically likes to invest in: strong brand names and little competition.

Here’s the reason Mr. Buffett gave for not investing in Amazon:

“The truth is that I’ve watched Amazon from the start, and I think what Jeff Bezos has done is something close to a miracle. The problem is if I think something will be a miracle, I tend not to bet on it.”

As for Alphabet, Mr. Buffett said that he had “made a mistake.” He said he was unable to conclude that at Alphabet’s present prices, its “prospects were far better than the prices indicated.”

He then explained that he didn’t invest in Apple because it was a tech stock. “I went into Apple because I came to certain conclusions about the value with which the capital was being deployed and about the ecosystem,” he said.

The discussion did lead to one of the more humorous exchanges of the meeting:

Mr. Munger: “I’ve been to Google headquarters. It looks to me like a kindergarten.”

Mr. Buffett: “A very rich kindergarten.”

One thing Mr. Buffett and Mr. Munger aren’t fans of? Cryptocurrencies.

Warren Buffett and Charles Munger saved their harshest words for cryptocurrencies.

“Cryptocurrencies will come to bad endings.” Mr. Buffett said, responding to an attendee from Ukraine.

Mr. Buffett’s main argument against cryptocurrencies is the same one he has made about gold: They are not a “productive asset.” That means the value of cryptocurrencies is determined solely by what someone is willing to pay for it.

“If you had bought gold at the time of Christ and you figure the compound rate on it, it’s a couple tenths of a percent,” Mr. Buffett said.

But his criticism didn’t stop there. He said cryptocurrencies attract a lot of “charlatans” and “people of less than stellar character.”

Mr. Munger was perhaps harsher. “It’s just disgusting,” he said.


Nati Harnik/Associated Press

Mr. Buffett isn’t backing off his comments about guns

In February, Warren Buffett was asked on CNBC about some chief executives distancing their businesses from the National Rifle Association. Mr. Buffett responded: “I don’t think that Berkshire should say we’re not going to do business with people who own guns. I think that would be ridiculous.”

That comment came up at Saturday’s meeting, and one shareholder wanted to know if Mr. Buffett had misspoken.

Mr. Buffett answered by largely repeating what he had said earlier this year:

“I do not believe on imposing my political opinions on the activities of our businesses.

“If you get into which of our companies are pure and which ones aren’t pure, I think it will be very difficult. I don’t think that we should question on the Geico policy form: Are you an N.R.A. member? And if you are, you just aren’t good enough for us.”

Mr. Munger then added:

”Certainly we’re not going to ban all guns surrounded by wild turkeys in Omaha.”

Warren Buffett is sticking by Wells Fargo

Over the past two years, regulators and whistle-blowers have revealed Wells Fargo employees were creating fake accounts using customers’ identities, forcing borrowers to buy unnecessary auto insurance, and overcharging on mortgage fees.

The Federal Reserve earlier this year restricted its growth until it demonstrates it is complying with bank regulations.

Berkshire first invested in Wells Fargo nearly three decades ago and is currently the bank’s biggest holder with a nearly 10 percent stake.

In response to a question about whether it was time to abandon the bank, which has already seen turnover in its executive suite and boardroom, Mr. Buffett said he thought Wells Fargo’s problems would only make it stronger in the long run.

“All the big banks have had troubles of one sort or another and I see no reason why Wells Fargo as a company, from both an investment standpoint and a moral standpoint going forward, is in any way inferior to the other big banks with which it competes,” he said.

He specifically praised the bank’s chief executive, Tim Sloan, a longtime Wells Fargo executive who took over when his predecessor John Stumpf resigned at the height of the fake account scandal. Criticism from Mr. Buffett could have increased pressure on Mr. Sloan. But the 87-year-old praised him.

“I like Tim Sloan as a manager,” Mr. Buffett said. “He is correcting mistakes made by other people.”

Mr. Buffett went further: What happened at Wells Fargo could’ve happened anywhere, he said.

“We know people are doing something wrong as we sit here at Berkshire. You can’t have 370,000 employees and expect that everyone is behaving like Ben Franklin.” On the fake account scandal specifically, which the bank has said resulted from intense pressure on its branch managers to increase sales, Buffett said: “Wells Fargo is a company that proved the efficacy of incentives and it’s just that they had the wrong incentives.”

— Emily Flitter

Is Mr. Buffett semiretired?

The question of who will succeed Warren Buffett has been a thread through many of the exchanges with shareholders.

Carol Loomis, a former Fortune writer, kicked off the question and answer session by reading a question from an investor, asking if Mr. Buffett is semiretired now. In recent years, Mr. Buffett has handed off some of his investing duties to Ted Weschler and Todd Combs, Berkshire’s two portfolios managers, and in January, Mr. Buffett promoted longtime Berkshire executives, Gregory E. Abel and Ajit Jain, to oversee Berkshire’s businesses.

“I’ve been semiretired for decades,” Mr. Buffett replied with a chuckle, but then he got serious.

“Ted and Todd each manage about 12 or 13 billion,” he said. “Together that’s $25 billion. They’re managing $25 billion and doing a very good job.”

He then quickly reminded the questioner of the size of the company’s assets: “I still have the responsibility for the other $300 billion.”

Charles T. Munger, Berkshire’s vice chairman, added: “I watch Warren. He spends most of his time reading and thinking and occasionally he’ll make a phone call or talk to somebody. Not much has changed.”

Another shareholder asked whether Berkshire will have trouble doing deals once Mr. Buffett is no longer with the company. Companies have regularly approached Berkshire over the years about being bought. That has allowed Berkshire to avoid bidding wars and to make acquisitions at lower prices.

The shareholder wanted to know if Mr. Buffett’s successor would continue to have access to those deals and whether Mr. Buffett and Mr. Munger should aggressively publicize the work of their successors to help pass on thei “hometown advantage.”

“I think the reputation of Berkshire as being a very good home for companies, particularly a very good private home for a company, I don’t think that reputation is dependent on me or Charlie,” Mr. Buffett said. “It may take a little — there may be a little testing period for whoever takes over.”

”The truth is that I think some of the other executives are getting better known,” he added.

— Emily Flitter and Stephen Grocer

Where does Berkshire’s health care venture with JPMorgan and Amazon stand?

A lot remains unknown about Berkshire’s health care partnership with Amazon and JPMorgan Chase more than three months after the companies announced the venture.

The three firms said in January that they were teaming up to try to find a better, cheaper way to provide health care to their own workers, a combined one million people. And they said if their idea worked, they would seek to share it with other companies.

Warren Buffett on Saturday again called the cost of health care “a tapeworm in terms of American business.” He lamented the success other countries — he did not name any — have had keeping their own health care costs at a lower proportion of their gross domestic product.

But just how Berkshire’s partnership will address the problem remains a big question.

Mr. Buffett had no more details to offer on Saturday. He said the people leading the effort are still searching for a chief executive. They could announce a hire “within a couple of months,” he added.

“Whether we can bring the resources, bring the person, that C.E.O., is terribly important. Bring the person, support that person and somehow figure out a better way for people to continue to receive better medical care in the United States,” he mused “We’ll see if that will happen.”

But Mr. Buffett seemed uncertain, though hopeful, about the effort as a whole.

“We are attacking an industry moat,” Mr. Buffett said. “That’s a huge moat. We’ll do our best. If we fail, I hope somebody else succeeds.”

Charles Munger, Berkshire’s vice chairman, weighed in: “I suspect that eventually when the Democrats control both houses of Congress and the White House, I suspect that we will get a single payer system, and I suspect it won’t be very friendly to the existing” pharmacy benefit managers.

— Emily Flitter


A drawing of Warren Buffett at Berkshire Hathaway’s annual meeting.

Rick Wilking/Reuters

Trade ‘is a win-win situation’

The Trump administration has taken a more combative stance on trade, particularly with China.

So it comes as little surprise then that one of the first questions put to Warren Buffett and Charles Munger was about trade. Here’s Mr. Buffett’s response:

“The United States and China are going to be the two superpowers of the world, economically and in other ways, for a long, long, long, long time. We have a lot of common interests, and like any two big economic entities, there are times when there will be tensions. But it is a win-win situation when the world trades, and China and the United States are the two big factors in that.”

“It is a win-win situation. The only problem is when one side or the other wants to win a little bit too much.”

About those accounting changes…

Warren Buffett warned in his annual letter that a new accounting rule would “severely distort Berkshire’s net income figures and very often mislead commentators and investors.”

Saturday morning Berkshire reported a net loss for the first quarter because of those accounting changes. The new rules require Berkshire to include in its earnings the gains and losses on the stocks it holds but has not sold.

In the first quarter, Berkshire’s net loss was $1.14 billion, compared with net income of $4.06 billion a year earlier.

Given the new accounting rule, Mr. Buffett suggested Saturday that shareholders should look at Berkshire’s operating income, which excludes gains and losses for Berkshire’s investments, for a more accurate picture of the company’s performance.

Berkshire reported its operating income rose 49 percent to $5.29 billion from a year ago.

— Stephen Grocer


Shareholders walking through the exhibit hall at Berkshire Hathaway’s 2018 annual meeting.

Rick Wilking/Reuters

Questions for Mr. Buffett

The main event every year at Berkshire Hathaway’s annual meeting is the question and answer session. Elisa Mala, a reporter working for The New York Times asked those attending Berkshire events on Friday what they would ask Mr. Buffett. Here is a sampling:

• What is the single greatest important investment in your lifetime? Is it a company? Is it a relationship? — Conner Van Fossen, Hanscom Air Force Base in Bedford, Mass.

• What are your thoughts about the future/sustainability of health care and Medicare, and how is Berkshire Hathaway’s joint venture with JPMorgan Chase and Amazon going to address this?Timothy Liu, San Francisco Bay Area.

• What does he see in the cryptocurrency market? Is it going to be the future? Is it going to replace the way we exchange value? Is it worth the hype? — Jason Lu, Shanghai

• Where do you see the job market going, given the rise of Artificial Intelligence? — Ralph Humphrey, Hillside, N.J.

• He’s been technology averse in the past. What makes him so bullish on Apple? — Brian Hanks, Salt Lake City, Utah

• How long he plans on doing this. —Bill Skidmore, Omaha, Neb.

— Elisa Mala


Jessica Staben taking a selfie with 1-year-old Cecilia Johnson in front of a caricature of Warren Buffett, right, and Berkshire Hathaway’s vice chairman Charlie Munger.

Nati Harnik/Associated Press

Scenes from Omaha: shopping day

(As Berkshire’s annual meeting has grown over the years, it has become a three-day event. Friday is Berkshire Hathaway’s shopping day, where shareholders can buy products from many Berkshire-owned companies.)

Shareholders moseyed around CenturyLink Center, where the annual meeting takes place, perusing dozens of booths displaying goods — many created specifically for the event — from brands like Geico, NetJets and Coca-Cola.

What was really on sale? All things Warren Buffett.

Investors could snack on a Dilly Bar, the long-favored Popsicle of the Oracle of Omaha, for $1 or snag “Warren and Charlie” rubber ducks ($5 for the pair at the Oriental Trading Company booth). There were Justin cowboy boots embroidered with the words “Berkshire Hathaway Inc. Shareholders Meeting” and guests had the option to “Put yourself in Warren Buffett’s boots,” as the marketing materials suggest, and purchase a style that had been owned by the man himself.

Jim Van Fossen, a retired financial planner, bought matching Berkshire Hathaway boxers for himself and his son, Conner Van Fossen. In town from Missoula, Mont., he said he wanted a memento of their first trip to the shareholders’ meeting.

Of course, shoppers and vendors were hoping for a sighting and interaction with the man himself. Failing that, they settled for selfies with his many likenesses. See’s Candies displayed Scotch Kiss confections “made by Warren,” and one staff member’s uniform bore Mr. Buffett’s autograph.

The most photographed autograph was at the Benjamin Moore paint booth, where Mr. Buffett had signed his name in permanent marker next to a wall-size mural of his face. All day long, revelers followed suit, decorating the wall with their own signatures in dry-erase ink, and snapping selfies to preserve the memory.

— Elisa Mala

health care

priceyear end

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Common Sense: Amazon, the Elephant in the Antitrust Room

But Amazon is already vertically integrated — it creates content and distributes it over the internet. So are Netflix, Google (with YouTube) and Facebook (with its Watch feature and other offerings).

Which is why the so-called FANG companies (Facebook, Apple, Amazon, Netflix and Google) loomed large at the just-completed AT&T-Time Warner trial and may well figure in a Sprint-T-Mobile decision, even though none of the technology giants is directly involved or is a party to the litigation.

AT&T’s chief executive, Randall Stephenson, repeatedly referred to the technology giants during the trial, and made clear that they are what drove the merger. “The media and entertainment industry is going through some rather significant disruption,” he testified. “It’s coming from predominately folks in the tech sector.”

The Time Warner chief executive, Jeff Bewkes, made the same argument. “They have the content, the programming, and they have the technological capability of delivering it straight to you,” he said, adding that by “they” he meant the FANGs. “And they can communicate with you about that relationship and what to watch and how to value the program.”

In closing arguments this week, AT&T and Time Warner’s lead trial lawyer, Daniel Petrocelli, argued that a combined company could use the kind of data about its users that is routinely collected by the tech companies to enhance its programming and offer more targeted advertising. It could use the resulting higher revenues to reduce consumer prices by what he estimated to be $500 million per year.

The government’s lead lawyer, Craig Conrath, provided a counterargument: “The fact that AT&T may want to compete in some other market, that doesn’t give them a free pass to reduce competition in the pay-TV market,” he said. (The pay-TV market has traditionally included subscription TV providers, including cable and satellite, but not over-the-internet providers like Amazon and Netflix.)

AT&T sees Netflix, YouTube and Amazon as “the wolves at the door,” said Scott Hemphill, an antitrust expert at the New York University School of Law. “That’s the center of their theory.”

Time Warner’s content companies, like HBO, CNN and the Turner channels, “are just islands of content unmoored from the consumer,” he said.


Although they aren’t parties to the government’s lawsuit, the biggest tech players, Facebook, Apple, Amazon, Netflix and Google, have cast a shadow at the AT&T-Time Warner trial.

Jason Henry for The New York Times

Of course, the argument can be made that AT&T doesn’t need to buy a company like Time Warner — it could create a media content company of its own. That’s what Amazon and Netflix did, and both companies now outspend Time Warner on original programming.

But from a consumer standpoint, it doesn’t really matter. “The major tech platforms are becoming vertically integrated as they create their own content to push out over their distribution platforms,” Rich Greenfield of the investment firm BTIG wrote in a recent research note. “In turn, is it O.K. to be vertically integrated if you build your way in, but not to buy your way into it? What if instead of an acquisition of Time Warner, AT&T just spent $8 billion a year on content creation, the way Netflix is — would that be legal, but buying Time Warner is not?”

Whether the FANG companies compete in the same markets with AT&T and Time Warner is of more than academic interest — it could well influence Judge Richard Leon’s decision, which he said he would deliver no later than June 12.

If Judge Leon does take such an expanded view of the market, AT&T and Time Warner would most likely prevail. Even if he does find some violations, he could impose conditions on the merger rather than block it entirely, much as Comcast had to accept conditions on its purchase of NBC Universal.

Making a case that the proposed Sprint-T-Mobile merger would benefit consumers is far more difficult. The deal has drawn near-unanimous opposition from antitrust experts.

The Sprint-T-Mobile tie-up, in contrast to AT&T-Time Warner, would be a horizontal merger — a combination of direct competitors, that way reducing the number of players operating in the market. Those kinds of deals have traditionally received more antitrust scrutiny.

The government rejected the same merger less than four years ago, and the result was robust competition and lower prices for wireless services — exactly what antitrust regulators fervently hope for. Before that, in 2011, the government blocked a proposed merger of AT&T and T-Mobile.

So the question is whether the markets in which they compete have so changed since then that a merger now wouldn’t harm consumers.

The two companies will need to argue that the market is no longer just the four wireless providers, but now includes the technology giants and broadband and cable companies like Comcast. A merged Sprint and T-Mobile would command only a small share of such a vastly expanded market, and wouldn’t have the power to raise prices.

That may arguably be the case for video, which can now be streamed over wireless handsets, but not for voice calls and texting, at least not yet. Sprint and T-Mobile are talking up the potential for 5G technology to further blur the lines between traditional markets, but widespread use of 5G is still years in the future.

Courts and antitrust regulators “don’t usually consider merger defenses that depend on the existence of undeployed technology,” said Herbert Hovenkamp, an antitrust professor at the University of Pennsylvania Law School and the Wharton School. “Our crystal balls aren’t that good. We don’t have the power to gaze five years down the road, especially when it comes to fast-changing technology.”

While Professor Hovenkamp said he understood the argument AT&T and Time Warner were making about Amazon, “this whole generic idea that companies need to merge to go up against Amazon may play to a general audience, but if you take it to its logical conclusion, it could be used to validate nearly every merger.”

Perhaps T-Mobile and Sprint could hold off a few years, and return with evidence that they’re actually competing with the big tech companies rather than merely anticipating that competition.

Then again, given the vagaries of the Trump administration’s antitrust policies, “they may feel there’s no reason not to roll the dice now,” Mr. Hovenkamp said.

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Amazon Pauses Huge Development Plans in Seattle Over Tax Plan

“I’m deeply concerned about the impact this decision will have on a large range of jobs — from our building trades, to restaurant workers, to nurses, manufacturing jobs and tech workers,” said Mayor Jenny Durkan. “At the same time, our city must urgently address our homelessness and affordability crisis and lift up those who have been left behind.”

Amazon’s decision comes as officials in other communities across the country are jockeying to bring Amazon’s business to town. The company is shopping for a second headquarters elsewhere in North America, saying it has outgrown Seattle. And just this week it announced plans to hire thousands more employees in Vancouver and Boston.


Under the plan the City Council is discussing, large employers in the city would face a head tax that amounts to about $500 a year per employee.

Elaine Thompson/Associated Press

The plan the Seattle City Council is discussing would apply only to companies with at least $20 million or more annually in taxable gross receipts. The so-called head tax would be transformed into a payroll tax in 2021. Three-quarters of the estimated $75 million that the tax raises would go to building almost 1,800 affordable housing units in the city, with the rest funding services for the homeless, the City Council said.

Amazon, Seattle’s largest employer with more than 45,000 local employees, would owe $20 million to $30 million annually from the head tax and perhaps significantly more when the payroll tax kicks in.

For months, Amazon has been quietly lobbying behind the scenes against the tax proposal. Its unexpected announcement could be nothing more than a negotiating tactic to help extract concessions from the council.

Mike O’Brien, a member of the Seattle City Council, said Amazon representatives told him on Wednesday morning that they were pausing their expansion projects in the city, without leaving room for discussion.

“They’re not really asking for anything,” he said. “They’re just telling us what they’re going to do.”

Mr. O’Brien said Amazon should not be solely blamed for the homeless problem in Seattle, but that the company bears some responsibility. “From my point of view, we have a crisis in our town around housing affordability and homelessness,” he said. “They’re closely related and it’s related to the booming tech industry in Seattle.”

He added, “I need to run a city that has room for prosperous businesses, but doesn’t do it at the expense of people getting pushed into poverty.”

Greg Johnson, the president of Wright Runstad & Co., a development firm that is constructing the building that Amazon said it may lease out, said an Amazon executive told him of the plans on Tuesday night. Amazon has a lease for about 720,000 square feet in the 58-story tower.

“What’s troubling is the 4,500 people Amazon was going to put in the building, they’re now considering elsewhere, and I don’t think it’s elsewhere in Seattle,” Mr. Johnson said.

Seattle had a tax on hours worked by employees in the city starting in 2008, though it was phased out after several years. States typically grant the authority to tax at the local level, and 13 states allow some form of local income tax, according to Bill Fox, a professor at the University of Tennessee who specializes in state and local taxation issues.

Other cities with booming tech economies, like San Francisco, are also seeing housing prices soar because of intense local resistance to allowing more development. In Seattle, people unable to keep up with the costs live in their cars or in tents by the sides of freeways. Those who are better off park recreational vehicles in industrial neighborhoods.

In 2017, the Seattle area had the third largest homeless population in the country after New York and Los Angeles, according to an annual report to Congress by the Department of Housing and Urban Development.

After years of criticism for being disengaged from the civic life of its hometown, Amazon has in recent years attempted to show a more compassionate side in Seattle. It has agreed to allow a homeless shelter for families, Mary’s Place, to occupy space rent-free in another building that it is putting up. That is one of several buildings that Amazon still intends to complete.

Still, even within Amazon itself, there are haves and have-nots. While it is common for employees at its headquarters in Seattle earn $100,000 to $200,000 a year, workers at its fulfillment centers are paid only a tiny fraction of that. The company recently disclosed that median pay at Amazon last year was $28,446.

Amazon’s search for a second headquarters has also fanned criticism of the company, in large part because of the hefty tax incentives many of the 20 finalist locations have offered in an attempt to lure the company.

Mr. O’Brien, the Seattle city council member, described Amazon’s search as shopping around to see which city will give it the best deal.” We need companies that want to locate in a city and are willing to work together,” he said.

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One Goal of Amazon’s HQ2: Learn the Lessons of Seattle

Amazon’s search for a second headquarters has been a pageant of finalist cities doing everything they can to woo the company and the good jobs and huge construction projects it would bring. The most controversial part of the process has been the big tax incentives that some state and local governments have offered Amazon, seen by critics as ineffective corporate giveaways.


Home prices in Seattle are growing faster than those in any other large city.

Kyle Johnson for The New York Times

Amazon wrapped up its visits in mid-April to all 20 finalist locations for its HQ2, as Amazon calls its second headquarters. The company is now following up with the cities, from Los Angeles to Indianapolis to Toronto, seeking further information as it narrows its search.

The company has a long wish list, including plentiful flights at local airports, a stable, business-friendly government and nearby recreational opportunities for employees.

But local officials did not anticipate Amazon’s interest in how to tackle some of the troubles that have turned it into a polarizing symbol of Seattle’s booming economy. The e-commerce giant is celebrated by many in Seattle for being the city’s biggest employer and adding tremendous wealth to the area. But it is villainized by others for bringing too much change, too quickly.

In Denver, Amazon and local officials talked at length about public transit options and the creation of bike lanes, said Mr. Bailey. They even discussed the possibility of Amazon financing a new light-rail station for its system, though no commitments were made, he said.


Amazon has agreed to give a shelter for homeless families rent-free space in a new office building the company is constructing in Seattle.

Ruth Fremson/The New York Times

In Atlanta, the company spoke to a representative of the Westside Future Fund, a nonprofit working to prevent displacement in an area being redeveloped. The fund will pay for the increases in property taxes for residents who have lived in the area since at least 2016 so that they’re not priced out of their homes.

In Amazon’s visit to Toronto, the company discussed its potential impact on the labor market and the affordability of housing, said Ed Clark, the business adviser to Kathleen Wynne, the premier of the province of Ontario.

“We’re all concerned about what could be gentrification or displacement, how do we deal with that,” said Aisha Glover, president and chief executive of the Newark Community Economic Development Corporation, which is involved in the New Jersey city’s bid.

Adam Sedo, a spokesman for Amazon, confirmed that public transport and housing affordability were important topics in conversations with the finalist locations but declined to elaborate further.


Amazon’s glass spheres in Seattle. The company employs about 45,000 people in the city, spread out among more than 30 buildings near downtown.

Kyle Johnson for The New York Times

The company employs about 45,000 people in Seattle, spread out among more than 30 buildings near the downtown area. Despite a construction frenzy, building of new homes hasn’t kept up with demand, leading to soaring housing costs in Seattle, where rents are now close to those in Boston and New York and home prices are growing faster than those in any other large city.

While Amazon is not the only reason for all the change, it has become the most convenient target for groups worried about home prices and paralyzing traffic.

“There was clearly a sensitivity both to the real and to the perceived impact when they come in to a place,” Mr. Clark said, referring to Amazon’s discussions in Toronto.

The company says it has given $40 million for affordable housing projects in Seattle. In a new office building it is constructing, Amazon has agreed to give a rent-free space to a homeless shelter for families. The company says its employees are big users of public transportation, with 17 percent of its local employees living in the same ZIP code in which they work.

“The pace of change has been so fast and housing supply has not kept up and the transit system has not kept up,” said Alan Durning, executive director of Sightline Institute, a nonprofit research group in Seattle focused on sustainability. “There’s a visceral public reaction to the whole rapid pace of change in the city symbolized by, and perhaps blamed too much on, Amazon.”

In May, Seattle’s City Council plans to vote on a tax — dubbed the “Amazon Tax” by locals — on the city’s largest employers. The tax is expected to raise $75 million annually, with most of the money being funneled into building affordable housing. The remainder will go to support services for the homeless.

This month, supporters of the plan staged a rally in front of Amazon’s glass spheres in Seattle holding signs that read “Tax Amazon” and “Tax Bezos,” referring to the company’s chief executive, Jeff Bezos. Asked why Amazon was discussing affordable housing with officials of the finalist cities for its second headquarters, Kshama Sawant, a socialist member of the Seattle City Council, said it was because of what’s happening in the company’s hometown.

“It’s because they’re getting massive pushback from ordinary people in Seattle,” said Ms. Sawant.

Growing cities with thriving local tech scenes are already grappling with affordable housing challenges, even without Amazon. Mr. Clark, the adviser involved in Toronto’s bid, said it helps that Amazon isn’t ducking the problem.

“To have someone coming in and worried about this issue and wanting to work with you to solve the issue is a big plus,” he said.

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Amazon Tries a New Delivery Spot: Your Car

The new in-car delivery service, which will be available in 37 cities and surrounding areas, is a variation of Amazon Key.

For in-car delivery to work, customers must have a 2015 or later Chevrolet, Buick, GMC or Cadillac vehicle with an active account with OnStar, the roadside assistance and navigation service from General Motors. Car owners with 2015 or newer Volvos with a similar service, On Call, can also receive in-car deliveries from Amazon.


After dropping off the package inside, the courier can close the trunk and consider the delivery complete.

Matt Edge for The New York Times

Couriers can use those assistance services to find the cars through satellite location-tracking and unlock the trunk.

Amazon said the service will be expanded to other carmakers over time. The company conducted a small pilot test of in-car delivery in Germany in partnership with Audi and DHL several years ago.

The company says its systems will allow couriers to unlock vehicles only once for each scheduled delivery, to prevent unauthorized access. Still, the service will require a hefty amount of trust that a courier won’t swipe any valuables. The in-car service requires fewer protections than Amazon’s in-home delivery service, which requires customers to have an internet-connected front door lock and security camera to deter any shenanigans by a courier once they’re inside.

“We believe in offering customers choices,” said Rohit Shrivastava, general manager of Amazon Key. “This product may not be for everyone.”

Although statistics on the prevalence of package theft are elusive, police departments across the country say it has become commonplace, especially as internet shopping has become mainstream behavior. Package thieves have even earned a snappy moniker, “porch pirates.”

James McQuivey, an analyst at Forrester Research, said Amazon has for years been ferociously tackling every obstacle it can identify to customers buying more goods online. “This goes back to one-click ordering,” he said. “The company knows that the less friction you have, the better.”

Customers won’t be able to get in-car deliveries if they park inside gated and underground parking garages where satellite signals often can’t penetrate. The service seems aimed especially at people who leave their vehicles in the lots of large, easily accessible suburban office parks.

Car owners, who are frequently discouraged from leaving valuables in their vehicles, may rightly be concerned receiving an Amazon package to their cars when they’re not present could make them a target. Amazon said customers shouldn’t worry — it will take care of a broken window or lock that happens as a result of a delivery to a car.

“If the damage is caused by a delivery and a customer calls, we will make sure it’s right,” Mr. Shrivastava said.

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Has Walmart Beaten Amazon for Control of Flipkart?: DealBook Briefing

Elsewhere in deals: Elliott Management wants Hyundai to reorganize its divisions and pay out more dividends. HNA cut its stake in Deutsche Bank amid its downsizing. How China is buying into Europe. Deutsche Telekom plans to fight Vodafone’s plan to buy Liberty Media’s German and Eastern Europe cable division. The parent company of Poker Stars agreed to buy Sky Betting & Gaming for $4.7 billion to get a foothold in Europe. Fresenius walked away from its $4.3 billion deal for Akorn, a maker of cancer drugs.

Newell settles with Starboard

Just over a month after cutting a deal with Carl Icahn (an agreement that Mr. Icahn’s frenemy Bill Ackman said was “a deal with the devil”), the consumer brands conglomerate has reached an accord with Starboard Value as well.

What’s in the peace agreement: Newell will name three new directors. Two — Gerardo Lopez, the C.E.O. of Extended Stay America, and Robert Steele, a former senior executive at Procter & Gamble — are independent. The third, Bridget Ryan Berman, a former C.E.O. of Giorgio Armany and executive at Google and Victoria’s Secret, was agreed upon by Starboard and Mr. Icahn.

How it came together: In a joint press release, Mr. Icahn said that Newell asked him to parley with Starboard. Key to reaching a truce was Mr. Icahn giving up two seats that he had taken on Newell’s board.

What the parties said about the deal

• Michael Polk, Newell’s C.E.O.: “This agreement will enable the Company to now focus exclusively on the execution of our transformation plans and our efforts to strengthen our financial and operational performance.”

• Mr. Icahn: “I am pleased that we were able to facilitate peace between the company and Starboard. Given that the company has so many more pressing priorities, this is clearly the best outcome for all shareholders.”

• Jeff Smith, Starboard’s C.E.O.: “We are confident this newly reconstituted board will bring a refreshed sense of urgency, oversight, and accountability to Newell.”

The market reaction: Shares in Newell were up over 3 percent in premarket trading on Monday.

— Michael de la Merced


Shawn Thew/EPA, via Shutterstock

Mike Bloomberg opens his wallet to fight climate change

Even after the Trump administration withdrew from the Paris climate accord, Mr. Bloomberg insisted that the U.S. keep up its financial obligations to the U.N. body overseeing the pact — using $4.5 million of his own money. “I’m going to send them a check for the monies that America had promised to the organization as though they got it from the federal government,” Mr. Bloomberg told CBS’s “Face the Nation.”

The former N.Y.C. mayor has shown he has no problem speaking out on his personal causes, even if they’re in opposition to President Trump’s policies. And he’s willing to put his own money to work as well.

What Mr. Bloomberg isn’t doing: Running for president — at the moment. “I think I can as a private citizen help in some of those things and that’s what I want to do with my life,” he said.


Yangshan port in Shanghai.

Associated Press

Meet the trading practice that Trump hates

“If you talk China, I’ve watched where the reporters have been writing 2 percent of our steel comes from China. Well, that’s not right,” President Trump said last month, before criticizing transshipping. The practice, which disguises the origins of metals and other imports, is a reason behind the U.S.’s fight with China — and the E.U., South Korea and Canada have moved to crack down on illicit uses of the maneuver. (Certain instances can be legal.)

Meanwhile, Steven Mnuchin is weighing a trip to Beijing, in the hopes that talks could avoid a full-blown trade war.

Elsewhere in trade: The E.U. and Mexico forged their own pact on Saturday, sending a message to Washington. And a trade war could hurt Google’s Android.

The political flyaround

• An NYT investigation into Scott Pruitt’s career before the E.P.A. found close ties to lobbyists — and an instance of a house purchase involving a lobbyist, a shell company and a questionable sale price. (NYT)

• Mike Pence’s older brother, Greg, is running for Congress — and his stewardship of a local gas station operator that went bankrupt is taking fire. (NYT)

• The Republican tax cuts sliced $18 billion off the book value of 100 big U.S. public companies — but that math may change as a lower tax rate takes hold. (FT)

• Will Kellyanne Conway finally take a role in the White House communications department? (Axios)

• Has the office of the presidency become too big to manage? (The Atlantic)


Richard Drew/Associated Press

Facebook’s hot seat moves to Europe

Mike Schroepfer, the company’s chief technology officer, will appear on Thursday before the British government committee investigating fake news and social media following the Cambridge Analytica scandal. (No Mark Zuckerberg this time.)

Testifying tomorrow before that committee will be Aleksandr Kogan, the academic who passed user data to Cambridge Analytica. Mr. Kogan apologized for his role, but said he was considering suing Facebook for suggesting that he had acted unethically. (The star witness last week — albeit in absentia — was the man who set up Cambridge Analytica’s parent company decades ago.)

Elsewhere in Facebook: How the newsfeed played a central role in inciting violence in Sri Lanka. A deeper look at how much influence Campbell Brown, the former journalist who now leads news partnerships at the company, actually has.


Jason Redmond/Agence France-Presse — Getty Images

Amazon critics are wary of their newest ally

For years, the e-commerce giant has taken arrows from all corners, from labor unions to think tanks to competitors. Now President Trump has joined the fray, but not everyone is comfortable being on the same side.

The issue: Mr. Trump’s attacks appear rooted in personal animus, clouding what others feel are legitimate criticisms. Matt Stoller of the Open Markets Institute told the NYT, “What he’s doing is a threat to democracy, but so is Amazon.”

Elsewhere in Amazon news: The average Amazon employee is in a warehouse, not a data lab, and earns a median annual salary of $28,446. Many Americans believe the e-commerce titan has the most positive social impact of any big tech company, according to a new survey. (Another survey found that more than half of Americans want more regulations of tech companies.)


Brian Kemm, who lost $300 because of a misdirected Zelle payment.

Melissa Lyttle for The New York Times

The problem with banks’ answer to Venmo

It’s the same issue that dogged Craigslist, PayPal and Venmo early on: fraud. Now Zelle, a payment service used by the likes of Bank of America and Chase, is grappling with what some analysts told the NYT is an alarming series of incidents. “I know of one bank that was experiencing a 90 percent fraud rate on Zelle transactions, which is insane,” said Genevieve Gimbert, a partner in PwC’s financial crimes unit.

The problem: Customers often aren’t notified when money is transferred; customers are subjected to phishing attacks that drain money from their accounts; buyers have no protections if sellers don’t provide paid-for goods.

Why it matters: Banks want their share of digital payments, and 18 so far have signed up with Zelle.

Elsewhere in finance: UBS’s strong first-quarter earnings were overshadowed by the bank’s wealth-management unit missing estimates.


Gary Gensler

Kayana Szymczak for The New York Times

The tech flyaround

• Gary Gensler has gone from Goldman Sachs trader to financial regulator under President Barack Obama to lecturer at M.I.T., where he plans to extol cryptocurrencies’ virtues and warn of their regulatory problems. (NYT)

• Meet the kolion, a Russian cryptocurrency that is gaining favor in rural areas — and being watched warily by Moscow. (WSJ)

• NewsGuard, a service that uses trained journalists to rate thousands of news and information sites, is starting a hotline for reporting fake news sites. (Axios)

• Major American consumer brands said that Alibaba retaliated when they refused exclusive partnerships with the company. The Chinese e-commerce company has struck deals to get its digital assistant into Audi, Volvo and Mercedes-Benz cars in China.

• Google has been criticized for its responses to upcoming European data rules. (FT)

• Electric scooters are causing havoc in San Francisco and L.A. The C.E.O. of one big maker, Bird Rides, says ¯_(ツ)_/¯. (NYT)

• Australia’s competition regulator said it would examine contracts between Uber and the restaurants that use Uber Eats. (Reuters)

• Flickr has a new owner: Yahoo unexpectedly sold the picture-sharing site to SmugMug. (Recode)

The speed read

• How Martin Sorrell’s departure from WPP has set off an intense debate about the future of the ad industry. (NYT)

• Matthew Barzun, a former U.S. ambassador to Britain, will lead the new British media outlet set up by James Harding, the former head of BBC News. (BuzzFeed)

• Volkswagen is trying to remake its company culture. It’s not going so well. (NYT)

• Brooks Brothers is celebrating its 200th anniversary with a return to tradition. (NYT)

• No fewer than nine groups have come together to work on a “people’s vote” on whatever deal the British government negotiates with the E.U. (NYT)

We’d love your feedback. Please email thoughts and suggestions to

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Amazon’s Critics Get New Life With Trump’s Attacks on the Company

Some are concerned about the president’s motivations for his attacks, which people close to Mr. Trump have said are often triggered by negative coverage of his administration in The Washington Post, a newspaper owned personally by Mr. Bezos. Mr. Trump has mingled his attacks on Amazon and the newspaper in some tweets, including one in early April slamming “the Fake News Washington Post, Amazon’s ‘chief lobbyist.’”

Matt Stoller, a fellow at the Open Markets Institute, a think tank that has become a vocal critic of the power of tech companies, said he believed Amazon was worthy of action by regulators in part because of its power in the book market. But he also said he found Mr. Trump’s efforts to “personalize law enforcement” troubling.

“What he’s doing is a threat to democracy, but so is Amazon,” Mr. Stoller said. “That’s the dilemma.”


Since Amazon purchased Whole Foods last year, it has become a bigger concern for labor unions like the United Food and Commercial Workers International Union.

Drew Anthony Smith for The New York Times

Still, early this month, after Mr. Trump launched another Twitter tirade against Amazon’s deal with the Postal Service, Mr. Stoller jumped on board on Twitter.

The most direct effort to tap Mr. Trump’s hostility toward Amazon was an advertisement last month about the contract to provide cloud computing services to the Defense Department — worth up to $10 billion, by some estimates. The ad, with a picture of Mr. Bezos looking chummy next to Secretary of Defense Jim Mattis, appeared in the president’s favorite hometown tabloid.

“I had never seen that before,” Katell Thielemann, an analyst who follows the government technology contracting market for the research firm Gartner, said of the attack ad.

The ad was placed by Less Government, which calls itself a nonprofit based in Washington, D.C. Seton Motley, who runs the group, did not respond to requests for comment. He has said in interviews that he funded the ad himself. It’s unclear who backs the group, but there are large tech companies, some with connections to Mr. Trump, that have expressed their unhappiness with how the contract is structured.

The contract came up in a dinner this month with Mr. Trump and Safra Catz, co-chief executive of Oracle, according to a person briefed on the matter, who asked not to be identified because the details are confidential. Ms. Catz told the president that the way the Defense Department had written the contract, awarding it to just one vendor, was an advantage to Amazon, the person said.

So far, Mr. Trump hasn’t publicly expressed concern about Amazon’s bid for the contract. The White House didn’t immediately respond to a request for comment.

Mr. Trump recently escalated his attacks on Amazon with a presidential order to review the Postal Service’s financial model, which he has denounced on Twitter as money-losing because of favorable deals worked out with Amazon. (The Postal Service denies that deals like its one with Amazon are unprofitable.)

“The playing field has to be leveled,” he told reporters this month, promising to take a serious look at policies that might affect Amazon.

Mr. Trump’s Amazon attacks have amplified criticisms that have been building for years among research groups and trade organizations that represent Amazon’s rivals.

They have produced studies that say Amazon’s warehouses — which employ more than 125,000 full-time workers in the United States — don’t increase total local employment because of losses in other sectors. They also question the wisdom of subsidies to attract them. The American Booksellers Association, which represents independent bookstores, recently published a similar report on Amazon’s economic impact.

The United Food and Commercial Workers International Union, one of the largest private-sector unions in the country, representing 1.3 million workers in grocery stores and related industries, said Amazon’s investments in automation would hurt workers. Since it bought Whole Foods last year, Amazon has become one of the union’s top concerns.

Asked about Mr. Trump’s attacks on Amazon, Marc Perrone, president of the union, said: “Allowing Amazon’s unchecked growth to continue will lead to the destruction of millions of American jobs. Which begs the question: Why aren’t all Democrats and Republicans speaking out?”

A spokesman for Amazon declined to comment.

When Mr. Trump bashes Amazon for not collecting taxes, he is echoing long-running criticism of the company by the Institute on Taxation and Economic Policy, a nonpartisan research organization. Amazon collects sales tax in states that have one for items it sells directly to shoppers, but in most states it does not when shoppers buy merchandise from independent merchants on Amazon.

Other critics — from technology pundits to a former chief executive of Walmart U.S. — have called for antitrust action against Amazon by the government, including a breakup of the company.

Amazon’s defense is that — even as it has swelled into a giant, with over $177 billion in revenue last year — its share of overall retail sales is still small, estimated to be in the mid-single digits in the United States. This, along with Amazon’s emphasis on keeping prices low, has made it challenging for opponents to spark action under current antitrust law, which is primarily focused on consumer harm.

It’s unclear if Mr. Trump can do much to get antitrust enforcers at the Federal Trade Commission or Justice Department, which are supposed to keep politics out of competition cases, to act against Amazon. But his executive order asking for a review of the Postal Service, including its relationship with customers like Amazon, could lead to changes unfavorable to the company.

In a recent opinion piece about Mr. Trump’s attacks on Amazon, the social critic Thomas Frank said he didn’t believe Mr. Trump would use antitrust laws to challenge Amazon, even though Mr. Frank would approve of such a move.

“I don’t like Amazon, and I don’t like Donald Trump either,” he wrote in The Guardian, the British newspaper.

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DealBook Briefing: Did Jeff Bewkes Help Time Warner’s Cause in Court?



William Hejl, a farmer worried by the threat of Chinese tariffs.

Dan Koeck for The New York Times

The timeline for a potential U.S.-China trade war

As the U.S. and China continue to posture over trade — alarming U.S. farmers, many of whom are in key electoral districts in the Midwest — it’s worth noting three upcoming dates, Peter Eavis writes.

On May 1, exemptions to the tariffs on imported steel and aluminum expire.

On May 22, the public comment period ends for another $50 billion worth of tariffs, and the Trump administration can announce a final list of targets.

And Aug. 18 is potentially the deadline for the administration to act on an investigation into Chinese trade practices. But there’s a provision for a 180-day delay after that.

Key caveats: President Trump has the power to pursue trade policy almost at whim. And a W.T.O. proceeding against China could take years.

Elsewhere in trade: How Qualcomm became collateral damage in the fight (China says its takeover of NXP Semiconductors has “hard to resolve” issues), while Washington continues to fret about Chinese tech. Rusal is betting on China for relief from U.S. sanctions. What worries the Fed about trade. And why Wall Street and trading allies increasingly ignore presidential statements.


Assembling a rifle at the Sturm, Ruger & Co. factory.

Eric Thayer/Reuters

Breaking: Amalgamated presses Sturm, Ruger on gun limits

The politically minded bank already adopted principles for limiting firearm sales laid out by the advocacy group Everytown for Gun Safety. Now it’s using its position as a (small) shareholder in Sturm, Ruger to urge the gun maker to adopt six Everytown principles.

Among them: Supporting mandatory background checks for all sales; binding sellers to a code of conduct; and adopting smart-gun tech. If Ruger doesn’t support those principles, Amalgamated would withhold votes for Sandra Froman, a Ruger director who’s also on the N.R.A.’s board.

Elsewhere in gun sales: Dicks’s Sporting Goods plans to destroy its stock of assault-style rifles.

The political flyaround

• Attorney General Eric Schneiderman of New York wants to change state law to allow repeat criminal charges against offenders granted a presidential pardon. An adviser to President Trump warned that Michael Cohen could flip. And meet the judge in his case, Kimba Wood.

• Karen McDougal and the publisher of the National Enquirer have settled. She can now publicly discuss her claim to have had an affair with Mr. Trump, who is spared the risk of legal proceedings. (NYT)

• A resolution demanding that Scott Pruitt quit the E.P.A. attracted signatures from 170 Democratic lawmakers. (The Hill)

• Ted Cruz’s Democratic challenger, Beto O’Rourke, is within 3 points in the latest Quinnipiac poll. (Axios)

• The Senate voted to overturn an Obama-era rule restricting car lenders from discriminating against minorities. (NYT)

• The S.E.C. voted to move ahead with public consultations on a rule requiring brokers to put clients’ “best interest” first. (Bloomberg)

• The rise and fall of the lobbyist Tony Podesta. (WSJ)


Jason Redmond/Agence France-Presse — Getty Images

The most important part of Jeff Bezos’s annual letter

It’s the disclosure that Prime now has over 100 million members. These are Amazon’s stickiest and most valuable customers, who order often and can access its streaming service. The company had $9.72 billion in revenue from subscription services, including Prime fees.

Mr. Bezos also talks about the importance of “high standards” for his digital behemoth. (And about yoga handstands.)

Elsewhere in Amazon: The company is moving its entertainment division to the Culver Studios, where “Raging Bull” and “E.T.” were made.

The tech flyaround

• Facebook is reportedly designing chips, and working to move 1.5 billion users worldwide beyond the reach of European data privacy rules. An Irish watchdog still has qualms about its facial recognition. And ad agencies are seeking substitutes for its hoard of personal data.

• Uber is reportedly in talks to hire VMware’s Zane Rowe as C.F.O., to help prepare an I.P.O. next year. The last of Otto’s founders, Don Burnette, has left Uber.

• Qualcomm has begun cutting about 1,500 jobs. (Bloomberg)

• Intel is closing its wearable tech group. (CNBC)

• Tencent, and others will put $437 million into a unit of the embattled tech conglomerate LeEco. (FT)


Lucas Jackson/Reuters

Goldman’s big task: looking less like the Goldman of old

As the firm moves more into consumer businesses — pushing its Marcus online lending platform, buying Adam Dell’s budget-planning app — it is looking less like a traditional investment bank and trading house and more like a one-stop shop. Like the universal banks JPMorgan Chase, Bank of America and Citigroup.

But the shift carries plenty of risk. “It goes against their history as a firm; they’ve no track record of expanding consumer, commercial or corporate banking,” the analyst Brian Kleinhanzl of KBW told the FT.

Elsewhere in banking: Credit Suisse and UBS are reportedly in talks to combine some of their back-office operations. The activist investor Edward Bramson has built a 5 percent stake in Barclays and wants to wind down its trading division, unnamed sources told the London Evening Standard.


William P. O’Donnell/The New York Times

The deals flyaround

• Bankers for Meredith have reportedly ruled out the National Enquirer owner A.M.I. as a bidder for Time, Fortune, Inc. and Sports Illustrated, rejecting a $300 million offer. (Vanity Fair)

• P.&G. agreed to buy Merck of Germany’s consumer health business for $4.2 billion. (WSJ)

• Total of France agreed to buy Direct Energie, a utility focused on clean energy, for $1.7 billion. (NYT)

• Lloyd Blankfein of Goldman Sachs and Jon Gray of Blackstone butted heads over a potential debt deal at a recent lunch. (Bloomberg)

• The U.K. will reportedly approve Melrose Industries’ bid for GKN. (FT)

• Avenue Capital is reportedly planning a social-impact debt fund. (Reuters)

• Bon-Ton Stores is going out of business. (WSJ)

• Grail, a cancer-detection start-up backed by Jeff Bezos and Bill Gates, is reportedly working to raise $1 billion. RealSelf, an online hub for cosmetic surgery information, has raised $40 million. And Green Bits, which makes software to help cannabis dispensaries stay legal, has raised $17 million from Tiger Global Management and others.

Revolving door

• Cerberus Capital Management has hired the former JPMorgan Chase C.O.O. Matt Zames as president. Frank Bruno, a Cerberus veteran, will become co-C.E.O. alongside Stephen Feinberg. (WSJ)

• Wynn Resorts has added three women to its board: Dee Dee Myers, who was a White House spokeswoman in the Clinton administration; Betsy Atkins, an advocate of stronger corporate governance; and Wendy Webb, a former investor-relations chief for Disney. (Bloomberg)

• Deutsche Bank’s C.O.O., Kim Hammonds, and investor-relations chief, John Andrews, are leaving. (WSJ)

• GlaxoSmithKline has hired Kevin Sin from Genentech as a top internal deal maker. (Reuters)

• Jana Partners has hired Dan Hanson, once of BlackRock, and Pulkit Agarwal, formerly of the International Finance Corporation, to work on its social impact investing fund. (Reuters)

The speed read

• The highest-ranking civil servant in Japan’s Finance Ministry resigned after accusations that he had sexually harassed female journalists. (NYT)

• Starbucks will become a test case for training to combat unconscious bias; its effectiveness is still a matter for debate. (NYT)

• Coastal communities are no longer the only ones suing fossil-fuel companies over the costs of climate change. (NYT)

• Porsche’s headquarters in Germany were raided by the police yesterday as part of an investigation into emissions cheating. (NYT)

• The departing editor of Harper’s Magazine, James Marcus, said he had been fired for opposing the publication of a contrarian essay on #MeToo. The magazine disputes that. (NYT)

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