AT&T’s Big Deal With Discovery Unwinds Billions in Mergers

Goldbelly’s growth surpassed its expectations. Sales more than quadrupled last year, and it nearly doubled the number of restaurants on its platform, to 850. That, according to Joe Ariel, its co-founder and C.E.O., was because the company allows restaurants like Di Fara pizzeria in Brooklyn and Parkway Bakery and Tavern in New Orleans to go national: “We’re basically opening up a 3,000-mile radius for restaurants.”

Can that good fortune continue? As in-person dining resumes across the U.S., Ariel concedes that Goldbelly’s phenomenal growth rate last year “is not going to happen forever.” But its newest backers believe that restaurants will keep making online sales part of their businesses. Goldbelly is also counting on maintaining its lead by spending more on marketing, offering livestreamed cooking classes and relying on the loyalty of chefs.

  • Ariel didn’t deny that the company has its eye on an I.P.O. “In the future, we do want to be a public company,” he told DealBook.


Cryptocurrency’s rise to prominence is reflected in the latest U.S. tax documents (due today, in case you forgot). This year, a virtual currency question tops Form 1040, the individual income tax return form, right after the personal identifying information. The I.R.S. wants to know: “At any time during 2020, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?”

Yes means no, sort of. If you only bought crypto with “real currency” then you aren’t required to answer “yes,” per the I.R.S. But this guidance is not binding, which means you can’t entirely rely on it. This relatively simple question, which is generating consternation among accountants, reflects the greater state of disarray when it comes to digital asset taxation.

  • “There’s very limited guidance on crypto,” Michael Meisler, a lawyer who leads EY’s crypto tax center, told DealBook. Basic tax principles apply to digital assets and many concepts translate from the physical to digital realm, but crypto is evolving fast. The approach taxpayers take depends on their tolerance for risk, Meisler said.

Cryptocurrency is property for tax purposes. That means that there is a tax liability for every sale or purchase using crypto, said Amy Kim, the chief policy officer of the Chamber of Digital Commerce, a trade group: “Imagine reporting the gain or loss on every cup of coffee you bought at Starbucks.”

Big Crypto wants the I.R.S. to flip its script. The tax authorities have engaged in an “enforcement-focused approach,” Kim said. “We believe this approach should be reversed — issue practical guidance, then enforce that guidance against those who do not comply.”

Deals

  • Alex Rodriguez and the Jet.com cofounder Marc Lore agreed to buy the N.B.A.’s Minnesota Timberwolves and the W.N.B.A.’s Minnesota Lynx for $1.5 billion. (NYT)

  • George Soros’s investment fund was among those that scooped up stocks at a steep discount when they were offloaded by Archegos during its implosion. (Bloomberg)

  • The influential proxy adviser I.S.S. backed three of four candidates for Exxon Mobil’s board put forth by the climate-minded activist investor Engine No. 1. (Bloomberg)

Politics and policy

  • Rural areas are counting on President Biden’s infrastructure proposal, in particular its expansion of broadband access, to help attract more workers. (NYT)

  • Proponents of Biden’s planned revival of the International Entrepreneur Rule to grant start-up founders special visas say it will create thousands of new jobs. (Axios)

Tech

  • “The Deadly Toll of Amazon’s Trucking Boom” (The Information)

  • Goldman Sachs’s online consumer banking unit lost another top executive as its C.F.O., Sherry Ann Mohan, defected to JPMorgan Chase. (CNBC)

Best of the rest

  • Leslie Moonves, who was fired from CBS in 2018, will receive nothing from the $120 million the company set aside in a potential severance package. (NYT)

  • Some advice on how to prevent the re-emergence of workplace cliques as people return to the office. (FT)

  • The publicly traded New Jersey deli with a $100 million market cap that David Einhorn identified as a symptom of irrational markets has fired its C.E.O. (CNBC)

We’d like your feedback! Please email thoughts and suggestions to dealbook@nytimes.com.

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Rural Areas Are Looking for Workers. They Need Broadband to Get Them.

As a manufacturer of asphalt paving equipment, Weiler is exactly the type of company poised to benefit if the federal government increases spending on roads and bridges. But when Patrick Weiler talks about infrastructure, the issue he brings up first has next to nothing to do with his company’s core business.

It’s broadband internet service.

Weiler is based in Marion County, Iowa, a rural area southeast of Des Moines. Internet speeds are fine at the company’s 400,000-square-foot factory, because Weiler paid to have a fiber-optic cable run from the nearby highway. But that doesn’t help the surrounding community, where broadband access can be spotty at best. That is a problem for recruitment — already one of the biggest challenges for Weiler and many other rural employers.

“How do you get young people to want to move back into these rural areas when they feel like they’re moving back into a time frame of 20 years ago?” asked Mr. Weiler, the company’s founder and chief executive.

Rural areas have complained for years that slow, unreliable or simply unavailable internet access is restricting their economic growth. But the pandemic has given new urgency to those concerns, at the same time that President Biden’s infrastructure plan — which includes $100 billion to improve broadband access — has raised hope that the problem might finally be addressed.

address to Congress last month. “This is going to help our kids and our businesses succeed in the 21st-century economy.”

Mr. Biden has received both criticism and praise for pushing to expand the scope of infrastructure to include investments in child care, health care and other priorities beyond the concrete-and-steel projects that the word normally calls to mind. But ensuring internet access is broadly popular. In a recent survey conducted for The New York Times by the online research platform SurveyMonkey, 78 percent of adults said they supported broadband investment, including 62 percent of Republicans.

Businesses, too, have consistently supported broadband investment. Major industry groups such as the U.S. Chamber of Commerce, the Business Roundtable and the National Association of Manufacturers have all released policy recommendations in the last year calling for federal spending to help close the “digital divide.”

Quantifying that divide, and its economic cost, is difficult, in part because there is no agreed-upon definition of broadband. The Federal Communications Commission in 2015 updated its standards to a minimum download speed of 25 megabits per second. The Department of Agriculture sets its standard lower, at 10 m.p.s. A bipartisan group of rural-state senators asked both agencies this year to raise their standards to 100 m.p.s. And speed-based definitions don’t take into account other issues, like reliability and latency, a measure of how long a signal takes to travel between a computer and a remote server.

recent study by Broadband Now, an independent research group whose data is widely cited, found that 42 million Americans live in places where they cannot buy broadband internet service, most of them in rural areas.

According to the F.C.C.’s definition, most of Marion County has high-speed access to the internet. But residents report that service is slow and unreliable. And with only one provider serving much of the county, customers have little leverage to demand better service.

Marion County, with 33,000 people, has economic challenges common to rural areas: an aging work force, anemic population growth and a limited set of employers concentrated in a few industries. But it also has assets, including its proximity to Des Moines and a group of employers willing to train workers.

Local leaders have plans to attract new businesses and a younger generation of workers — but those plans won’t work without better internet service, said Mark Raymie, chairman of the county Board of Supervisors.

“Our ability to diversify our economic base is dependent on modern infrastructure, and that includes broadband,” he said. “We can say, ‘Come and work here.’ But if we don’t have modern amenities, modern infrastructure, that sales pitch falls flat.”

Mr. Weiler’s daughter Megan Green grew up in Marion County, then left to go to college and start her career. When she moved home in 2017 to work for her father’s company, it was like returning to an earlier technological era.

“Our cellular service is more spotty, our wireless is more temperamental, and we definitely only have one choice,” Ms. Green, 35, said. “It’s a bit of a generational thing. We rely on internet access.”

Ms. Green moved home for family reasons. But finding others willing to do the same has been difficult. Broadband isn’t the only factor — shortages of housing and child care also rank high — but it is a major one. Recruiting is Weiler’s “No. 1 challenge,” Ms. Green said, despite wages that start around $20 an hour, before overtime.

The experience of the past year has accentuated the problem. When the pandemic hit last year, Weiler sent home any workers who didn’t have to be on the factory floor. But they quickly encountered a problem.

“I was shocked to know how many of our employees could not work from home because they did not have reliable internet access,” Ms. Green said. “We’re talking ‘seven minutes to download an email’ type internet access.”

Other local companies had a similar experience. In June, the Greater Des Moines Partnership, a regional business group, commissioned a study on how to improve the area’s digital infrastructure. With the state and federal governments considering significant investments, the group hopes its study will give it priority for funding, said Brian Crowe, the group’s head of economic development.

For Marion County and other rural areas, the widespread experiment with working from home during the pandemic could present an economic opportunity if the infrastructure is there to allow it. Many companies have said they will allow employees to continue to work remotely all or part of the time, which could free workers to ditch city life and move to the country — or take jobs at companies like Weiler while their spouses work from home.

“All of a sudden, it’s not going to be the case that in order to work for leading companies, you have to move to the cities where those companies are located,” said Adam Ozimek, chief economist for Upwork, a platform for freelancers. “It’s going to spread opportunity around.”

But broadband experts say there is no way that rural areas will get access to high-speed, reliable internet service without government help. If a place doesn’t have internet access in 2021, there is a reason: generally too few potential customers, too dispersed to serve efficiently.

“The private sector’s just not set up to solve this,” said Adie Tomer, a fellow at the Brookings Institution who has studied the issue. He likened the challenge to rural electrification almost a century ago, when the federal government had to step in to ensure that even remote areas had access to electrical power.

“This is exactly what we saw play out in terms of economic history in the 1910s, ’20s, ’30s,” he said. “It really is about towns being left behind.”

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Low-income households can now apply for a $50 monthly discount for internet.

Millions of low-income Americans became eligible on Wednesday for an emergency discount on high-speed internet service and devices to get online, an effort aimed at providing relief to families that have struggled during the pandemic as school, work and health care have moved online.

The Federal Communications Commission’s subsidy program, the Emergency Broadband Benefit, can be used for $50 monthly discounts for individuals on SNAP or Medicaid, recipients of Pell grants, and families with children on free and reduced-price lunch plans. Low-income households on tribal lands can apply for $75 in monthly broadband subsidies. The program also allows for a one-time $100 subsidy for a laptop or tablet.

The F.C.C. said 825 broadband providers have agreed to offer the discounts.

The program, which Congress approved $3.2 billion for late last year, is one of several efforts to bring broadband internet to all American homes. The F.C.C. earlier this week also approved a $7.2 billion program to give students high-speed internet access through schools and libraries. President Biden has promised to make broadband affordable and available for all and has proposed a $100 billion effort to connect every rural and low-income home to high-speed internet service.

The Emergency Broadband Benefit program comes late in the pandemic, with schools and workplaces beginning to open again. The delay was largely because of wrangling over details of the subsidies in Congress and at the F.C.C. during the Trump administration. And it’s unclear what will happen once the one-time emergency benefit fund runs out.

The program will end either when the $3.2 billion fund is depleted or six months after the Department of Health and Human Services declares an end to the pandemic.

“High-speed internet service is vital for families to take advantage of today’s health, education, and workplace opportunities,” Jessica Rosenworcel, the acting chair of the F.C.C., said in a statement. “And the discount for laptops and desktop computers will continue to have positive impact even after this temporary discount program wraps up.”

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Biden Defends Unemployment Benefits, Provided Workers Accept Job Offers

WASHINGTON — President Biden ordered the Labor Department on Monday to ensure that unemployed Americans cannot draw enhanced federal jobless benefits if they turn down a suitable job offer, even as he rejected claims by Republicans that his weekly unemployment bonus is undermining efforts to get millions of Americans back to work.

Stung from a weekend of criticism over a disappointing April jobs report, Mr. Biden struck a defiant tone, seeking to make clear that he expects workers to return to jobs if they are available, while defending his signature economic policy effort thus far and blaming corporate America, in part, for not doing more to entice people to go back to work.

The president told reporters at the White House that child care constraints, school closures and fears of contracting the coronavirus had hindered job creation last month, and he challenged companies to help workers gain access to vaccines and to raise their pay.

“The last Congress, before I became president, gave businesses over $1.4 trillion in Covid relief,” Mr. Biden said. “Congress may have approved that money, but let’s be clear: The money came from the American people, and it went from the American people to American businesses, many of them big businesses, to help them get through this pandemic and keep their doors open.”

legal confrontation over whether states can cut taxes after taking relief money and using it to solidify their budgets.

the guidance said.

Treasury and White House officials made clear that they would scrutinize how the funds were being used to ensure that state budgets were not being gamed to violate the intent of the law. A new recovery office at the Treasury Department will coordinate with states to help determine if their policies are in line with conditions set forth in the law.

The relief money also cannot be paid into state pension funds to reduce unfunded liabilities.

A White House official would not comment on whether initiatives like Montana’s return-to-work bonuses could be funded using relief money. States and cities are being given broad discretion on how they can use the money, which is intended to replace public sector revenue that was lost during the pandemic; to provide extra pay for essential workers; and to be invested in sewer, water and broadband infrastructure.

Treasury Secretary Janet L. Yellen’s guidance failed to clarify the matter.

“Arizona should not be put in a position of losing billions of dollars because the federal government wants to commandeer states’ tax policies,” Mr. Brnovich said.

The allocation of the funds is also likely to be a contentious matter as the money starts to flow. Some states have complained that states that managed the pandemic well are essentially being penalized because the formula for awarding aid is based on state unemployment rates.

The Treasury Department said on Monday that the states that were hardest hit economically by the pandemic would also get their money faster.

Local governments will generally receive half of the money this month and the rest next year. But states that currently have a net increase in unemployment of more than two percentage points since February 2020 will get the funds in a lump sum right away.

Officials also said Monday that the administration would issue new guidelines meant to speed money from the recovery act to help child care centers reopen, and that the Labor Department would highlight a program that allows some unemployed workers to accept offers of part-time jobs without losing access to the federally supplemented benefits.

Mr. Biden said that the efforts would help the economy recover — and that the rebound from recession remained on track.

“Let’s be clear: Our economic plan is working,” he said. But he said recovery would not always prove to be easy or even. “Some months will exceed expectations,” he said, “others will fall short.”

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Biden Administration Will Begin Disbursing $350 Billion in State and Local Aid

The Biden administration will begin deploying $350 billion in aid to state and local governments this month, a significant step in its effort to shore up segments of the economy that have been hardest hit by the pandemic, White House and Treasury officials said on Monday.

The infusion of funds also marks the Biden administration’s most significant opportunity to date to start reviving infrastructure across the nation and to fulfill its goal of ensuring a more equitable recovery.

“With this funding, communities hit hard by Covid-19 will able to return to a semblance of normalcy. They’ll be able to rehire teachers, firefighters and other essential workers — and to help small businesses reopen safely,” Treasury Secretary Janet L. Yellen said in a statement.

The details of the disbursement have been eagerly awaited by the states, cities, territories and tribal governments that are expected to receive money. But several Republican-led states and the Biden administration are in a legal confrontation over whether states can cut taxes after taking relief money and using it to solidify their budgets.

return-to-work bonuses could be funded using relief money.

States and cities are being given broad discretion on how they can use the money, which is intended to replace public sector revenue that was lost during the pandemic; provide extra pay for essential workers; and invest in sewer, water and broadband infrastructure.

The allocation of the funds is also likely to be a contentious matter as the money starts to flow. Some states have complained that states that managed the pandemic well are essentially being penalized because the formula for awarding aid is based on state unemployment rates.

The Treasury Department said on Monday that the states that were hardest hit economically by the pandemic will also get their money faster.

Local governments will generally receive half the money this May and the rest next year. But states that currently have a net increase in unemployment of more than 2 percentage points since February 2020 will get the funds in a lump sum right away.

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Fake Comments on Net Neutrality Rollback to Cost Companies Millions

Internet service providers funded an effort that yielded millions of fake comments supporting the Federal Communications Commission’s repeal of so-called net neutrality rules in 2017, the New York attorney general said on Thursday.

Internet providers, working through a group called Broadband for America, spent $4.2 million on the project, Attorney General Letitia James said. The effort generated roughly nine million comments to the agency and letters to Congress backing the rollback, almost all signed by people who had never agreed to the use of their names on such comments, according to the investigation. Some of the names had been obtained earlier, in other marketing efforts, officials said. The agency approved the repeal in late 2017.

Broadband for America’s members include some of America’s most prominent internet providers, like AT&T, Comcast and Charter, as well as several trade groups.

Supporters of the repeal regularly cited the number of comments opposing the rules. Investigators said Broadband for America had “commissioned and publicized a third-party study” of how many comments were being submitted, and then briefed F.C.C. officials on their findings as part of their push.

net neutrality rules, which forbade them to block content, slow it down or make people pay more to deliver it faster.

Ajit Pai, then the chairman of the Federal Communications Commission, announced a plan to repeal the rules in April 2017. Around the same time, Broadband for America started to pay providers of lead generation services millions of dollars to generate comments at the F.C.C. and letters to Congress supporting the repeal.

Investigators said Broadband for America had acted to give Mr. Pai “cover” to repeal the broadband regulations. The internet providers have staunchly opposed attempts to regulate the industry for years, including by pushing for Congress to approve weaker rules instead.

In total, about 18 million of the 22 million comments sent to the F.C.C. during the debate over the net neutrality rules were fake, the investigation found. More than nine million fake comments were filed at the F.C.C. supporting the rules, arguing that repealing them would leave consumers paying more for a slower internet, according to investigators. A 19-year-old computer science student was responsible for more than 7.7 million of them.

The activist group Fight for the Future and several news outlets raised early concerns about the possibility that some of the comments were fake, after individuals whose names appeared on messages to the F.C.C. said they had not signed on to them.

“The public record should be a place for honest dialogue, but today’s report demonstrates how the record informing the F.C.C.’s net neutrality repeal was flooded with fraud,” Jessica Rosenworcel, the agency’s acting chairwoman, said in a statement. “This was troubling at the time because even then the widespread problems with the record were apparent.”

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