After 15 years of airline consolidation, the spirit of competition is up in the air.

A federal judge ruled yesterday that JetBlue cannot acquire Spirit Airlines, marking the end of a deal that would have shaken up the airline industry. Judge William Young/Les Mis fan sided with the Justice Department, which opposed the merger, saying it would harm customers by eliminating a low-cost travel option.

In addition to making it hard for broke college students to get to the Austin City Limits festival, the $3.8 billion deal was set to make JetBlue and Spirit the fifth largest airline in the country behind Delta, American, United, and Southwest. JetBlue and Spirit argued that the merger would be the only way for them to compete with the Big Four airlines.

How we got here: Since 1960, four of the biggest carriers (Delta, American, United, and Southwest) have collectively acquired 36 other airlines, according to Axios. Those four airlines control two-thirds of domestic air travel, according to the Bureau of Transportation Statistics.

It’s a win for antitrust regulators

The ruling is a key victory for the Justice Department, which has sought changes to the airline industry in the last few years. While the DOJ under President Biden hasn’t had much success taking down Big Tech, it has fared better against airlines: Last year, it forced JetBlue to dismantle its Northeast Alliance partnership with American Airlines.

But…if 2024 was supposed to be the year of the merger, this isn’t a promising start. Yesterday’s decision casts a dark cloud over the proposed Hawaiian Airlines–Alaska Airlines merger, as experts predict the DOJ may block that deal, too.

Looking ahead…JetBlue and Spirit issued a statement saying that they both disagreed with the ruling and were evaluating next steps. Spirit’s stock plunged on the news, while JetBlue’s was up.—CC

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The US launched new strikes against Houthi targets in Yemen. The strikes—the third round since last week—targeted Houthi militants who were preparing to launch missiles at both commercial and US Navy ships in the Red Sea, according to military officials. The US also said it was searching for two Navy SEALS who went missing on Friday during an operation to seize Iranian-made missile parts on their way to the Houthis. The news comes as Houthi rebels continue to attack civilian ships for what they say is retribution for Israel’s war against Hamas in Gaza. Shell became the latest major company to suspend shipments through the Red Sea as the conflict escalates.

Another Trump trial got underway. After he tried (unsuccessfully) to delay it, the former president was in attendance Tuesday for his civil defamation trial, brought by E. Jean Carroll, who alleged Trump raped her in a department store in the 1990s. A 2022 jury found that Trump sexually assaulted and then defamed Carroll, and now the second trial will determine how much he must pay (he does not face any jail time, since it’s a civil case). Carroll, who is expected to testify, is seeking more than $10 million in damages. It’s just one of a litany of ongoing legal battles for Trump as he overwhelmingly leads the 2024 GOP presidential primary race.

Apple took Samsung’s smartphone crown. For the first time since 2010, Samsung does not sit atop the global smartphone shipment rankings. Apple topped the South Korean tech giant in 2023 with 234.6 million mobile shipments, according to IDC’s Worldwide Quarterly Mobile Phone Tracker. Samsung finished the year with 226.6 million. IDC noted that Apple’s first-ever No. 1 ranking was largely due to the rising global popularity of premium devices, which now account for 20% of the market. Both Apple and Samsung are facing increased competition from Chinese phone-maker Huawei.

We don’t want to get too excited and spook the lawmakers, but Congress might actually be on the verge of agreeing to do something. A House Republican and a Senate Democrat who chair important committees announced yesterday that they’ve come to an agreement on a $78 billion plan that would implement a new version of the child tax credit and provide corporate America with tax breaks through 2025.

What’s in the potential bill?

• Something for the Ds: The bill would help lower-income families get more refundable child tax credit, even if it exceeds their tax bill. Right now, most lower-income families aren’t able to claim even close to the $2,000 per child credit most middle- and upper-income families can. The Center on Budget and Policy Priorities (which leans left) said the proposed tax credit could lift 400,000 children above the poverty line in the first year of the program.
• Something for the Rs: It includes $33 billion in corporate tax breaks (that businesses can also take retroactively) related to costs for interest payments and research and development.
• And for both: The whole bill would be paid for by sunsetting a fraud-ridden Employee Retention Credit.

Not so fast. Lawmakers are hoping to pass the deal before tax season starts on January 29, but that would require quickly scooting it through both the House and Senate, which…have a rough track record working together these days, as the House is down more than a McDonald’s ice cream machine.—MM

Uber revealed yesterday that it plans to shut down the alcohol delivery platform Drizly by March. The ride-hailing app bought the company for $1.1 billion three years ago, when everyone was drinking at home getting purchases delivered to their doorsteps.

But growth in the delivery market has since slowed. And after the boozy biz got in trouble with regulators over its user data management…

• Uber SVP of Delivery Pierre-Dimitri Gore-Coty told Axios—which broke the story—the company is instead prioritizing Uber Eats and focusing on “helping consumers get almost anything—from food to groceries to alcohol—all on a single app.”
• Drizly laid off 100 employees last year, while some of its offerings have already been integrated into Uber Eats.

Sobering moment

After the Uber takeover, it came out that a 2020 data breach affecting 2.5 million of Drizly’s users was caused by a security vulnerability that the company and its former CEO were aware of but failed to fix. That prompted the Federal Trade Commission to limit the kinds of customer info that Drizly could collect and store, which might’ve undermined its ability to profit from selling data.

Uber isn’t alone…in quickly bailing on a subsidiary that once cost it a pretty penny: Google recently slashed the product team at Fitbit, the wearable tech brand it acquired for $2.1 billion in 2021, as it focuses on developing its own Pixel Watch.—SK

Stat: Two things Mark Zuckerberg and Batman have in common: They’re both masters of the martial arts, and they both can’t stop kinda just flying around. According to a Wall Street Journal analysis, corporate jet use for personal travel is soaring, and Zuck is the most frequent flier. Companies in the S&P 500 spent $65 million for their executives to use corporate jets in 2022, up 50% from 2019, per the analysis. Meta alone spent $6.6 million on personal flights for Zuckerberg and former COO Sheryl Sandberg in 2022, up 55% from before the pandemic. In total, the number of companies offering free flights to execs jumped 14% from 2019. Companies claim it’s safer and more efficient than putting their head honchos on commercial flights with us peasants.

Quote: “Some people think I’m crazy.”

How many people have you given your cell phone number to? If it’s less than 60,000, congrats, you’re officially harder to reach than the CEO of Adidas. In an attempt to put the kibosh on employees’ concerns about transparency, Bjørn Gulden gave his personal number out to all 60k of them. He told the WSJ that he was then contacted about 200 times per week, mostly by staffers asking him to change the company. As Adidas struggles through a period of controversy and weaker sales, perhaps Gulden can text his way out of it.

Read: How group chats have quietly come to rule the world. (New York Times)

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