Bethany Patterson

ATR Submits Tunney Comments in Support of T-Mobile/Sprint Merger

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Posted by Bethany Patterson on Monday, October 14th, 2019, 3:04 PM PERMALINK

Americans for Tax Reform sent a letter to the Department of Justice in support of the T-Mobile/Sprint merger.

Companies should be able to merge or split without the government’s blessing, and as such, the T-Mobile/Sprint merger should be able to proceed without burdensome and unnecessary intervention.

The T-Mobile/Sprint merger will enhance competition, benefit consumers and create new jobs, while helping the United States maintain its position as the global leader in innovation and technology. Mergers are also pro-competitive, and as evidenced in the airline industry, lead to lower prices for consumers.  

You can read the full letter below and linked to here.


October 10, 2019

Scott Scheele
Chief, Telecommunications and Broadband Section
Antitrust Division, U.S. Department of Justice
450 Fifth Street, N.W., Suite 700
Washington, D.C. 20530

Re: United States of America et al. v. Deutsche Telekom AG et al.; Case 1:19-cv-02232

Dear Mr. Scheele:

The T-Mobile–Sprint merger will facilitate healthy broadband competition, benefit Americans and help close the digital divide. Companies should be able to merge or split without government permission, and doom and gloom rhetoric should not stand in the way of innovation and job creation. For these reasons, I urge the Department of Justice to approve the merger.

By combining T-Mobile and Sprint into one company, the New T-Mobile will serve as a stronger competitor to the leading wireless companies. According to data from Strategy Analytics, the new company will have 126.2 million subscribers, allowing it to compete more fully with Verizon and AT&T, which each have approximately 150.5 and 141.6 million subscribers.[1]

Increased competition would incentivize these carriers to invest more in their networks, deploy 5G technology, develop new services and products, and offer competitive pricing.

The merger will lead to lower prices. T-Mobile and Sprint have a consistent historical record of providing innovative services at lower prices. The companies have made considerable voluntary commitments for their new network, including pledging to create a 5G network that covers 99 percent of Americans within six years[2] and to not raise prices for the next three years.[3]

Mergers are signs of healthy competition.[4] For example, within the airline industry, mergers have proven to be pro-competitive. Following recent airline mergers, ticket prices for Americans have decreased overall.[5] The New T-Mobile will have the same impact on the wireless industry.

Americans – particularly those in rural areas – stand to benefit from the combination in myriad ways, including shrinking the digital divide, rapid 5G deployment, and job creation across the nation. Florida, Kansas, Louisiana, Nebraska, Ohio, Oklahoma and South Dakota have formally supported the consent decree. Leaders from Utah[6], Mississippi[7], the Navajo Nation[8], and other states have also shown their support.

T-Mobile and Sprint have committed to deploy a 5G network that will cover almost the entire country, with 97 percent of the United States population and 85 percent of rural America covered within three years.[9]  These commitments will transform the lives of millions of Americans – many of whom reside in states that support the merger – who lack reliable internet access.

The T-Mobile–Sprint merger will also create jobs across the United States. The companies have pledged to create 12,400 jobs in small towns and rural America by 2021, create 7,500 customer care jobs by 2024, and open 600 new retail locations across the United States.[10]

This will bring life to many rural or underserved communities. As Navajo Nation President Jonathan Nez wrote in a letter to the Federal Communications Commission and Department of Justice, a post-merger T-Mobile will be “essential to [the Navajo Nation’s] economic recovery.”[11]

In short, the T-Mobile–Sprint merger will lead to increased broadband competition, greater connectivity, and economic growth.

I urge the Department of Justice to support free-market values and encourage you to approve the creation of the New T-Mobile. If you should have any questions or comments, please contact me or Katie McAuliffe by phone, 202-785-0266, or email,


Grover Norquist


[1] Rani Molla, “A merged T-Mobile and Sprint will still be smaller than AT&T or Verizon,” Vox, April 30, 2018,

[2] “Re: Applications of T-Mobile US, Inc. and Sprint Corporation for Consent to Transfer

Control of Licenses and Authorizations; WT Docket No. 18-197,” Federal Communications Commission, May 20, 2019,

[3] John Legere, “New T-Mobile: Lower Prices and Better Service. Period.”, March 20, 2019,

[4] Patrick Hedger, “Will T-Mobile/Sprint Merger Increase Prices?”, Competitive Enterprise Institute, August 21, 2019,

[5] Dennis Carlton et. al, “Are legacy airline mergers pro- or anti-competitive? Evidence from recent U.S. airline mergers,” International Journal of Industrial Organization 63 (2019): 58-95.

[6] Utah Office of the Attorney General, “Utah Attorney General Reyes: The T-Mobile/Sprint Merger Will Benefit Rural Utah,” Utah Office of the Attorney General, August 9, 2019,

[7] Mississippi Office of the Attorney General, “AG HOOD SETTLES CONCERNS ON T-MOBILE-SPRINT MERGER, INCREASES SERVICES AVAILABLE FOR MISSISSIPPIANS,” Mississippi Office of the Attorney General, October 9, 2019,

[8] Jonathan Nez to Federal Communications Commission and Department of Justice, August 28, 2019,

[9] “Re: Applications of T-Mobile US, Inc. and Sprint Corporation for Consent to Transfer

Control of Licenses and Authorizations; WT Docket No. 18-197,” May 20, 2019.

[10] T-Mobile and Sprint, “Creating Thousands of Jobs from Day One,” NewTMobile.com

[11] Jonathan Nez to Federal Communications Commission and Department of Justice, August 28, 2019.


Photo Credit: Mike Mozart

ATR Joins Coalition Supporting the Prohibition of Punishing Acquitted Conduct

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Posted by Bethany Patterson on Thursday, September 26th, 2019, 1:12 PM PERMALINK

Americans for Tax Reform, along with 23 other organizations, signed a letter in support of the Prohibiting Punishment of Acquitted Conduct Act of 2019. The bill would strengthen the protections provided by the Constitution by abolishing the fundamentally unfair practice of sentencing defendants for acts they were acquitted of by a jury.

You can read the letter below and linked to here.

September 26, 2019

The Honorable Lindsey Graham
Committee on the Judiciary
U.S. Senate

Washington, D.C. 20515

The Honorable Dianne Feinstein
Ranking Member
Committee on the Judiciary
U.S. Senate

Washington, D.C. 20515

Re: Prohibiting Punishment of Acquitted Conduct Act of 2019

Dear Chairman Graham and Ranking Member Feinstein:

The undersigned organizations write in support of the Prohibiting Punishment of Acquitted Conduct Act of 2019, which was introduced this week by Senators Durbin and Grassley, and cosponsored by Senators Leahy, Tillis, Booker, and Lee. This bill would end the unjust practice of judges increasing sentences based on conduct for which a defendant has been acquitted by a jury.

The Fifth and Sixth Amendment guarantees of due process and the right to trial by jury for those accused of a crime are fundamental to our criminal justice system. These guarantees require the government to prove a defendant’s guilt to a jury beyond a reasonable doubt. 

Despite this, current federal law allows judges to override a jury’s not guilty verdict by sentencing a defendant for the very conduct he or she was acquitted of by the jury. This is because the law requires a jury to convict beyond a reasonable doubt, but allows a judge to impose sentencing enhancements based on the less demanding standard of preponderance of the evidence. 

Permitting sentencing based on acquitted conduct is unjust, undermines due process, and subverts the critical function of jury trials in our legal system. This practice has been roundly criticized by practitioners, judges, and scholars. In one case, three defendants were convicted of possessing small amounts of crack cocaine, but were acquitted by the jury on conspiracy to distribute charges. Nevertheless, the judge increased their sentences based on them engaging in a conspiracy. Though the Supreme Court did not take the case, Justice Scalia, joined by Justice Ginsburg and Justice Thomas, stated that the practice of sentencing based on acquitted conduct “has gone on long enough” and constituted a likely violation of the Sixth Amendment. Additionally, former Judiciary Committee Chairman Hatch introduced the original version of this bill in 2018, and has persuasively argued that justice depends on conviction by a jury, not a judge. 

Allowing acquitted conduct to be considered in sentencing also exacerbates the trial penalty, which is generally manifested in the significant difference in sentence between what a defendant receives via plea bargain and what his or her sentence would be if convicted at trial. This trial penalty has virtually eliminated the constitutional right to a trial in the federal system. It also contributes to the possibility of innocent people pleading guilty, because they fear the long and harsh sentence they would receive if convicted at trial, even if the chance of conviction is remote. Unsurprisingly, the crucial constitutional protection that the right to trial by jury provides is weakened when a defendant may be sentenced based on conduct even when he or she is acquitted of that conduct by a jury. This contributes to coercive plea bargaining and to the trial penalty. 

We urge you to support this bill, which would eliminate an unjust practice and would strengthen the protections our Constitution provides. 

If you have further questions, feel free to contact Nathan Pysno, Director of Economic Crime and Procedural Justice at the National Association of Criminal Defense Lawyers, at 202- 465-7627 or 


National Association of Criminal Defense Lawyers 


Aleph Institute 

American Civil Liberties Union 

American Conservative Union 

ALEC Action 

Americans for Prosperity 

Americans for Tax Reform 

Church of Scientology National Affairs Office 

Digital Liberty 

Drug Policy Alliance 

Due Process Institute 

Fair Trials 

Faith and Freedom Coalition 


Federal Public and Community Defenders 

Innocence Project 

National Legal Aid & Defender Association 

Prison Fellowship 

R Street Institute 

Right on Crime 

The Sentencing Project 

Texas Public Policy Foundation 

Tzedek Association

Photo Credit: Chris Potter

ATR Supports the ED ACCESS Act of 2019

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Posted by Bethany Patterson on Thursday, September 26th, 2019, 12:56 PM PERMALINK

Americans for Tax Reform joined 23 other organizations in support of the ED ACCESS Act of 2019. The bill would remove the lifetime ban on the American Opportunity Tax Credit for those convicted of a drug felony, enabling more Americans to rebuild their lives through education following a conviction.

You can read the letter bellow and linked to here.


September 26, 2019


The Honorable Chris Van Hollen
United States Senate
110 Hart Senate Office building

Washington, D.C. 20002

The Honorable Rob Portman
United States Senate
448 Russell Senate Office Building

Washington, D.C. 20002

The Honorable Danny K. Davis
United States House of Representatives
2159 Rayburn House Office Building

Washington, D.C. 20515

The Honorable David Schweikert
United States House of Representatives
1526 Longworth House Office Building

Washington, D.C. 20515


RE: Letter of Support for the ED ACCESS Act of 2019


Dear Senators Van Hollen and Portman and Representatives Davis and Schweikert,

We write to express our support for the Eliminating Discrimination and Creating Corridors to Expand Student Success (ED ACCESS) Act of 2019, which would remove the lifetime ban on the American Opportunity Tax Credit for individuals convicted of a drug felony. Since 1998, individuals have been able to claim a portion of qualified tuition, fees, and course materials paid for themselves if eligible, or for an eligible student, in the form of a federal tax credit for the first four years of higher education. However, individuals convicted of a state or federal drug felony have been barred for life from claiming this federal tax credit.

Congress enacted the HOPE Scholarship Tax Credit in 1998, which included the drug felony ban. In 2009, Congress reformed this tax credit and renamed it the American Opportunity Tax Credit (AOTC) but retained the drug felony ban.

More than twenty years ago, when Congress first enacted what would become the AOTC, it was believed that forms of punishment like the drug felony ban would reduce demand and supply for illegal drugs. We now know that imposing these kinds of barriers only jeopardizes those with a prior drug felony’s ability to succeed.

For individuals seeking to rebuild their lives following a conviction, education is one of the most valuable tools. Research shows that the more education an individual obtains, the less likely they are to be incarcerated. For the tax code to arbitrarily discriminate against those with a felony drug conviction is nonsensical. It is also inappropriate to address drug policy in the tax code.

The drug felony ban simply amounts to duplicative punishment for individuals who have already paid a debt through prison time, fines, probation, or rehabilitation programs. The ban also disproportionately affects people of color. Although no more likely to use drugs than other students, African Americans are more likely to be convicted of a felony drug law violation that renders one ineligible for the AOTC.

The felony ban also creates confusion that likely deters taxpayers from claiming the AOTC even when eligible. For instance, millions of people across the country are arrested annually for violations of drug laws that vary by state. Possession or distribution of a drug in one state may be a felony while it’s a misdemeanor in another state. Removing the felony ban will make the AOTC fairer, simpler and more effective.

Exclusions to AOTC eligibility do not exist for any other class of crimes. The ED ACCESS Act would simply strike the felony drug offense exclusion from the code in 26 U.S.C. 25A(b)(2)(D) to equalize the law. Thankfully, there is precedent for doing so. The exclusion would have been repealed in a larger reform of education tax credits in the Student and Family Tax Simplification Act, which passed the House in 2013 with bipartisan support.

Congress should remove arbitrary barriers like the American Opportunity Tax Credit drug felony ban that could impede the success of individuals who are seeking to improve their lives and equalize the treatment of this form of tax-based federal student aid.


American Conservative Union

Americans for Tax Reform

Campaign for Liberty

Center for Law and Social Policy (CLASP)

Center for Worker Freedom

College & Community Fellowship

CURE (Citizens United for Rehabilitation of Errants)

Digital Liberty

Drug Policy Alliance


Health in Action Justice Lab, Northeastern University School of Law 

Justice Action Network

Justice Roundtable

Legal Action Center

Operation Restoration


National Association of Criminal Defense Lawyers

National Association of Social Workers

National HIRE Network

National LGBTQ Task Force Action Fund

Prison Fellowship

R Street Institute

Safer Foundation

Students for Sensible Drug Policy 


CC: Senator Jeff Merkley; Senator Ron Wyden; Senator Susan Collins; Senator James Lankford Representative Steven Horsford; Representative Brad Wenstrup; Representative Terri Sewell; Representative Kenny Marchant




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T-Mobile/Sprint Merger Will Create a More Connected America

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Posted by Bethany Patterson on Wednesday, August 14th, 2019, 1:27 PM PERMALINK

Today, Federal Communications Commission Chairman Ajit Pai formally announced his support of the T-Mobile/Sprint merger. 

Chairman Pai’s support is a major step forward to realizing the benefits of a combined T-Mobile and Sprint. The New T-Mobile will build out a nationwide 5G network, help close the digital divide and be more fully capable of competing against the leading wireless companies. 

Both T-Mobile and Sprint have committed to building out their mid-band spectrum holdings, developing a network that will cover 97 percent of Americans — including 85 percent of rural residents — within three years. The companies have also pledged to create an in-home broadband product that would provide internet to underserved areas across the country.

This will help the millions of Americans without broadband access engage in the digital world. 

It will also strengthen the United States’ position as the global leader in technology. By aggressively rolling out its 5G network, the New T-Mobile will incentivize other carriers to do the same. Since the United States could considerably improve its deployment of mid-band spectrum, this is not an opportunity we can afford to pass up. 

T-Mobile and Sprint have already made significant commitments for their new network, including pledging to not raise prices for three years. The companies will also create 7,500 customer service jobs by 2024 and open 600 new stores across the country. 

By supporting this merger, Chairman Pai is supporting a stronger, more connected America. The FCC should formally approve the T-Mobile/Sprint merger — it will be beneficial for competition, consumers and the American economy.

Photo Credit: Mike Mozart

States Should Support the T-Mobile/Sprint Merger

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Posted by Bethany Patterson, Katherine Ryerson on Thursday, August 8th, 2019, 2:55 PM PERMALINK

The group of state attorneys general who filed a lawsuit to block the T-Mobile/Sprint merger in June continue their misguided efforts despite the Department of Justice’s approval of the transaction in July. 

A combined T-Mobile/Sprint would be highly beneficial for Americans, who would benefit from the greater connectivity, faster internet and economic growth the merger would bring.

Yesterday, Americans for Tax Reform President Grover Norquist sent a letter in support of the merger to Texas Attorney General Ken Paxton, the only Republican attorney general who has joined the lawsuit.

He also sent letters to the attorney generals of Louisiana, West Virginia, Florida and Tennessee — all states that would benefit greatly from the T-Mobile/Sprint merger.

The merger will be instrumental in helping close the digital divide. T-Mobile and Sprint have committed to build a 5G network that will cover 97 percent of Americans — including 85 percent of rural residents — within three years. The companies have also pledged to create an in-home broadband product that would provide internet to underserved areas across the country.

As of now, many Americans do not have adequate access to the Internet, especially in rural areas. Only 62.6 percent of West Virginians and 63.3 percent of Louisanans in rural areas have access to fixed 25 Mbps/3 MBps and mobile LTE 5 MBps/1Mbps, according to the FCC.

Over 2.3 million Floridians and 1.8 million Texans have limited access to high speed internet. Without reliable broadband access, it is extremely difficult to pay bills, apply for jobs, and run successful small businesses.

This problem also greatly impacts children who live in rural areas. More than 25 percent of Tennessee’s middle and high school students do not have home internet access. They cannot complete online school assignments like homework or other activities at home without it. The commitments that T-Mobile and Sprint have made would change these Americans’ lives. 

The merger will also provide more competition in the wireless industry, not less. The New T-Mobile will be a larger third competitor to the two top wireless carriers, which will drive down prices and lead to better service for all Americans. 

In addition, it will create 5,600 new customer service jobs and employ 7,500 more people than Sprint and T-Mobile do separately — not to mention the 3 million new jobs their new 5G network could create. 

In other words, this has the potential to transform the lives of millions across the country. 

The merger between Sprint and T-Mobile would boost competition, create new jobs, benefit consumers, and most importantly, connect underserved Americans to the digital world. Our political leaders should embrace this future of greater connectivity and support the merger. 

Photo Credit: Mike Mozart

ATR Supports Michael Kratsios’ Nomination as U.S. Chief Technology Officer

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Posted by Bethany Patterson on Wednesday, July 24th, 2019, 12:50 PM PERMALINK

In March, President Trump nominated Michael Kratsios to be Chief Technology Officer of the United States.

Kratsios currently serves as deputy assistant to the President for technology policy and as Deputy Chief Technology Officer. Since 2017, he has served in the White House Office of Science and Technology Policy, where he has helped guide the United States’ policies on emerging technologies.

In particular, Kratsios has had an essential role in developing the Administration’s approach to artificial intelligence, 5G and spectrum, broadband, quantum computing, autonomous vehicles, commercial drones and advanced manufacturing.

While at the White House, Kratsios has repeatedly reinforced the value of free-market principles when deploying new technologies—particularly in regards to 5G.

“Empowered by free-market capitalism and driven by bold ideas, Americans created an ecosystem of innovation that is the envy of the world, advancing science and technology and making the Nation prosperous and strong,” he wrote in a memo with Mick Mulvaney, director of the Office of Management and Budget.

The Chief Technology Officer ensures the United States remains the global leader in technology and innovation. Because of Kratsios’ history with promoting free-market and pro-growth values, Americans for Tax Reform supports his nomination.

In light of today’s Senate Committee on Commerce, Science and Transportation nomination hearing, Americans for Tax Reform’s President Grover Norquist sent a letter to Chairman Roger Wicker and Ranking Member Maria Cantwell in support of Kratsios' nomination. Click here to view Norquist’s letter to President Trump regarding Kratsios’ nomination.

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A Single-Vendor Cloud Strategy Leaves the DoD Vulnerable

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Posted by Bethany Patterson on Tuesday, July 2nd, 2019, 2:12 PM PERMALINK

The Department of Defense (DoD) is marching on with its Joint Enterprise Defense Infrastructure (JEDI) cloud services contract, despite pushback from both the public and Congress. 

The contract’s procurement process has been controversial from the start, and Congress has openly questioned the project, which would award a $10 billion contract to a single cloud services vendor for the next 10 years.

Last month, the House Appropriations Committee announced it will not fund the transfer of data to the JEDI cloud until the DoD reports how it will transition to multi-cloud. The committee even wrote in its report that the DoD is “deviating from established OMB policy and industry best practices, and may be failing to implement a strategy that lowers costs and fully supports data innovation for the warfighter.”

And in October, Congressmen Steve Womack and Tom Cole expressed similar concerns when they asked the DoD’s Inspector General’s Office to investigate why the department continues “to insist on a contract structure that runs contrary to industry best practices.”

Multi-cloud environments are generally seen as more secure and flexible than single-vendor cloud programs. Because of this, the DoD’s pursuit of a single-vendor cloud program could create long-term problems for the department. 

Committing to one vendor for 10 years could hinder the DoD’s ability to innovate. Technology moves fast, and the DoD must adapt to and adopt these new technologies quickly. If the department is locked in with one vendor, it may not be able to utilize cutting-edge technologies from other companies that would strengthen the warfighter. 

The 10-year commitment could also indirectly restrict competition. It will likely be difficult for the DoD to transfer 10 years’ worth of data and applications to another vendor, potentially ensuring that the department continues to use the first vendor, even after the contract has ended. 

But fostering competition is in the best interest of the DoD and taxpayers. Competition incentivizes providers to offer better services and lower costs. According to Trey Hodgkins, CEO of Hodgkins Consulting, a multi-cloud and multi-vendor approach would give the department “full access to the wide range of technical innovations developed in the commercial marketplace, increasing both functionality and security while reducing costs through competition.”

Taking a multi-cloud approach could also help the Pentagon protect itself against cyber attacks. According to Lieutenant General VeraLinn Jamieson, the deputy chief of staff for Air Force intelligence, multi-cloud programs give the enemy a “targeting problem.” 

The Navy, Army and Air Force are pursuing multi-cloud contracts, as is the Central Intelligence Agency (CIA). After six years with a single-vendor contract, the CIA is changing to a multi-vendor, multi-cloud strategy “to increase access to cloud innovation and reduce the disadvantages associated with using a single cloud service provider,” according to a House Appropriations Committee report

In light of the benefits of a multi-cloud approach, it’s perplexing why the DoD is still pursuing JEDI, especially since it has received a lot of pushback. 

The bottom line is that while the DoD is right to modernize its operations and adopt technologies to bolster the warfighter, it should seriously consider using multiple cloud vendors to most effectively use taxpayer dollars, foster innovation and strengthen national security.

Photo Credit: David B. Gleason

Getting the Facts Right on the T-Mobile–Sprint Merger

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Posted by Bethany Patterson on Wednesday, June 12th, 2019, 2:06 PM PERMALINK

Yesterday, attorneys general from nine states and the District of Columbia filed a lawsuit to block the T-Mobile–Sprint merger.

New York Attorney General Letitia James and California Attorney General Xavier Becerra are leading the lawsuit with the support of the attorneys general from Colorado, Connecticut, the District of Columbia, Maryland, Michigan, Mississippi, Virginia and Wisconsin.

The lawsuit filing states that the merger violates antitrust laws and would harm competition, consumers and innovation. In a statement, New York Attorney General James said the merger should be blocked “because this is exactly the sort of consumer-harming, job-killing megamerger our antitrust are designed to prevent.”

The facts are that this merger would boost competition, create new jobs and benefit consumers.   

The merger would bolster competition

The lawsuit states that the merger will harm competition. While it’s true that the top four mobile carriers would be consolidated into three, that doesn’t necessarily lead to decreased competition.

The top two wireless carriers are Verizon and AT&T, which have approximately 150 million and 142 million subscribers, respectively. The two hold around 67 percent of the market share.

Not only do Verizon and AT&T have a huge portion of the market share, but they are massive companies in and of themselves. Both don’t operate solely in the wireless carrier industry; AT&T owns DirecTV, HBO, DC Films and Fandango, and Verizon owns AOL, Yahoo and Oath Media (now Verizon Media).

While Sprint and T-Mobile both have subsidiaries, none are as powerful as the ones owned by Verizon and AT&T.

It’s also important to note that Sprint may not have a future without the merger. In an April 2019 filing with the FCC, the company wrote that it is losing customers and does not have enough money to pay its debts and invest in its networks. “Simply put, Sprint is not on a sustainable competitive path,” the document reads.

Few companies could afford to purchase Sprint’s assets if it were to go under. Perhaps huge companies like Verizon, AT&T or Comcast could, but that wouldn’t help increase competition.

However, if T-Mobile and Sprint merge, they would create the company the New T-Mobile, which would have 126 million subscribers. The New T-Mobile would be more able to fully compete with the current wireless top dogs. The merger wouldn’t create some behemoth that would eat up the entire market; it would actually level the playing field.

The merger would create jobs

In a press conference following the announcement, New York Attorney General James said the merger would result in “the loss of thousands of jobs nationwide.”

The reality is that the New T-Mobile will create more jobs. T-Mobile’s CEO John Legere has pledged to create 5,600 new customer service jobs and 7,500 more people than the standalone companies would have.

Some have claimed that the merger would result in 28,000 lost jobs. That just wouldn’t work from a business operations standpoint. Currently, Sprint has approximately 30,000 employees. If the New T-Mobile eliminates 28,000 jobs, the new company would not be able to operate.

The merger would benefit consumers

The state attorneys general are also concerned about the merger’s effects on rural and lower-income consumers, particularly prepaid users.

Though the attorneys general claim that this will result in higher prices, both companies have said that they will not raise prices for the next three years.

They have also committed to build up our nation’s 5G network, particularly in rural areas. Within three years, the 5G network would cover 97 percent of Americans, including 85 percent of rural residents. The two companies will also create an in-home broadband product, which can also work in underserved areas.

In order to address competitive issues in the prepaid wireless market, the companies have also decided to divest Boost Mobile, Sprint’s prepaid wireless carrier.

Former FCC Commissioner Mignon Clyburn, who opposed the AT&T–T-Mobile merger in 2011, wrote that T-Mobile has a reputation for serving cost-conscious Americans. She believes the merger will “create an inclusive, nationwide 5G network and services that will greatly improve access to broadband for all New Yorkers, not just the wealthy.”

In other words, the T-Mobile–Sprint merger will help Americans in typically underserved areas stay connected online and participate in the digital economy.

The bottom line is that a merger between T-Mobile and Sprint would help the country—it would close the digital divide and strengthen the nation’s global competitiveness. Instead of muddying the waters with unnecessary lawsuits, we should embrace a future of 5G and increased connectivity.

Photo Credit: Mike Mozart

Spotify Wants to Use Apple’s Services for Free

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Posted by Bethany Patterson on Friday, June 7th, 2019, 4:08 PM PERMALINK

Apple Music and Spotify are at war for our ears, and Spotify is fighting dirty.

Even though Spotify has been outperforming Apple Music, it has filed a complaint against Apple in Europe, claiming it is engaging in anticompetitive behavior. The European Commission will now conduct an antitrust investigation against the company.

But can Apple’s business practices really be classified as anticompetitive?

The App Store provides a platform where Apple users can easily access millions of apps from all over the world. Though Apple offers its own messaging, music and internet browser apps, Facebook Messenger, Gmail, Whatsapp, Spotify and Google Chrome are some of the most downloaded apps in the store.

The company reviews 100,000 apps a week and approves most of the proposals. Spotify claims that Apple is purposely interfering with the app’s user experience. But the App Store has released almost 200 app updates for the music streaming company, and Spotify’s Apple Watch app is currently leading in the watch’s music category.

That doesn’t sound like a company trying to squash its competition.

The vast majority of apps in the App Store pay nothing to Apple. The company only collects a commission on digital goods and services sold within the App Store, since those sales are processed through its proprietary payment system.

Free apps that process subscriptions within the App Store using Apple's payment processing system (like Hulu or Pandora) pay a 30 percent commission for the first year of that subscription and 15 percent for subsequent years.

Spotify has circumvented this fee by requiring users to subscribe outside the app. An Apple-user who wants to subscribe to Spotify Premium must sign up through the company’s website; afterward, the user can listen to music on the iOS Spotify app. Apple does not collect any commission on these subscriptions.

But now Spotify wants to conduct sales through the App Store without paying for Apple’s payment processing services.

In a blog post, the company’s CEO Daniel Ek wrote that if it were to pay the commission, it would need to raise its prices and therefore couldn’t compete with Apple Music. So Spotify wants to force Apple to either stop collecting commission on in-app purchases or offer other payment options within the App Store.

In other words, it wants to access Apple’s platform, utilize its software tools and use its payment system for free.

The App Store provides a reliable and secure place for apps to conduct transactions. Spotify doesn’t get to call the shots or demand to use Apple’s digital infrastructure for less money, especially since the streaming company is thriving by having users subscribe outside the app.

It’s time that Spotify becomes willing to pay for the services it’d like to use.

Photo Credit: Marco Verch

Congress, Tell States That Taxing Authority Stops at Their Borders

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Posted by Bethany Patterson on Thursday, June 6th, 2019, 9:13 AM PERMALINK

Money-hungry states are attempting to reach past state lines and impose business taxes on companies that aren’t within their borders.

The Business Activity Tax Simplification Act (BATSA), which was just reintroduced this week in the House by Congressman Steve Chabot, would stop greedy state governments from imposing these taxes outside their borders. Americans for Tax Reform signed a coalition letter urging Congress to pass the legislation and stop similar state tax intrusions.

In May, the Massachusetts Department of Revenue proposed to collect corporate income taxes on any business that has “considerable in-state sales derived through either economic or virtual contacts.” In other words, a Nevada-based company that sells products to Boston residents may be forced to pay Massachusetts’ corporate income tax.

The proposal cites last year’s Supreme Court decision on South Dakota v. Wayfair, which enables states to collect sales taxes on out-of-state businesses. Because of previous Supreme Court rulings (most notably Quill Corp. v. North Dakota), many states did not pursue levying business income taxes on companies that don’t own property or have employees within their borders.

Because Wayfair laid the groundwork to collect sales taxes on out-of-state companies, attempts to tax businesses’ income will likely increase.

Considering the huge impact e-commerce has on the economy, this unwarranted expansion of states’ power could have dramatic negative consequences. For one, increasing tax burdens and compliance costs would likely have a chilling effect on the economy as a whole.

Under BATSA, states would only be able to collect business activity taxes on companies that have a significant physical presence in the state. BATSA would set a simple standard: states can only levy business activity taxes on businesses that have property or employees within their borders.

In other words, BATSA would ensure that companies are taxed fairly and uniformly, while creating a clear nexus standard that would eliminate confusion and reduce lawsuits.

If businesses are less worried about unexpected taxation, they can focus their profits—which otherwise would be wasted on unnecessary tax litigation and preparation—on job creation and investment.

Congress has the Constitutional authority to shield citizens and companies from disastrous state tax laws. It should use this authority to keep overreaching states’ hands off of companies’ hard-earned revenues.

View the coalition letter in support of BATSA here.

Photo Credit: IAmSanjeevan