Snap CEO Evan Spiegel. Mike Blake/Reuters

Last year, Snap CEO Evan Spiegel got paid more than the heads of some of the world's biggest companies, including Apple chief executive Tim Cook and Google boss Sundar Pichai.

In fact, he was probably the best-paid CEO in America, according to data firm Equilar, which tracks executive pay in the US. Spiegel received a massive $638 million (£456 million) stock and compensation payout after Snap floated last year.

Speaking to The Financial Times, Equilar spokesman Dan Marcec said: "It is very rare for us to see an award that large. I would be surprised if we saw a larger one for 2017."

We already know how much Pichai and Cook were paid last year. Cook made $12.8 million (£9.2 million), while Pichai made almost $200 million (£143 million), according to filings.

It's astonishing that Spiegel was paid more given Apple and Google — both in the top five firms globally by market cap — were massively profitable in 2017. Apple and Google are nearing a $1 trillion (£715 billion) market cap, while Snap is currently lingering at around $22 billion.

Snap has yet to turn a profit, and in fact, lost $720 million (£515 million) last year. It's a much younger company, but it's had a rough first year as a public firm.

When it first went public, investors worried how much money Snap could make from advertising versus the competition. Snap's camera-enabled spectacles, Snap Spectacles, were also a failure. And users hate the Snapchat app's redesign — so much so that sceptical Wall Street analysts last week downgraded Snap's stock.

"The Angry Birds Movie." Columbia Pictures Good morning! Here is the tech news you need to start your Friday.

1. Apple is reportedly working on a new pair of AirPods. The new earbuds are said to support the "Hey Siri" command, have a new wireless chip, and be scheduled for this year, while a water-resistant version may be launched in 2019.

2. The FCC's Restoring Internet Freedom order will become active on April 23. The order will repeal the 2015 Net Neutrality rules.

3. Top artificial intelligence (AI) experts and policymakers from 14 institutions have published a report on the malicious uses of AI. The 100-page paper outlines digital, physical, and political dangers.

4. Intel reportedly failed to disclose Spectre and Meltdown flaws to US cybersecurity officials before the news leaked online. Both Apple and Alphabet, Google's parent company, as well as Intel, have said as much in letters sent to US congressmen.

5. Airbnb has debuted a new service called "Airbnb Plus." The premium offering, active in 13 cities globally, has been designed to compete with hotels, and includes amenity-filled places that are professionally inspected and photographed.

6. Snap's stock slid over 6% after an analyst warned of negative reactions to the recent update. Also, Kylie Jenner's tweets that suggested that she uses the app less after the update may have contributed to the stock's fall.

7. Amazon is reportedly planning to open up to six new Amazon Go cashier-less stores this year. There is no clear indication about their location, but rumours say that they will most likely be in Seattle and Los Angeles.

8. Apple Pay has an estimated 38 million active users in the US and 127 million globally, up from 62 million a year ago. That, in turn, means that only about 16% of iPhone users worldwide use Apple Pay.

9. "Angry Birds" maker Rovio's stock has fallen over 50% to about €5 (£4.4/$6.2), well below its original €11.50 (£10.20/$14.20) IPO price. The revenue guidance for 2018 has been weak, too, with a maximum of €300 million (£265/$370 million) in forecast opposed to the €336 million (£292/$414 million) predicted by analysts.

10. Intel is partnering with several companies to launch 5G-powered Windows 10 machines in 2019. Partner firms include Microsoft, Dell, Lenovo, and HP.

David Becker/Getty Images

While 2017 was a wash for tech M&A, we're barely a month into the new year and that narrative is already changing.

This is hardly a surprise. In a single year, tech executives' confidence in the global economy increased to more than 80%, from less than 20%, according to the 17th edition of the EY Global Capital Confidence Barometer - Technology. Pair this with optimism about corporate earnings, tax reform liquidity and confidence in credit availability, and you have an environment that is highly conducive to dealmaking. In fact, 57% of tech executives surveyed said they intend to pursue acquisitions in the next twelve months.

New entrants on the buy side of potential deals are likely to drive greater activity levels in the coming months. Because we continue to live in a sellers' market, buyers need to be agile and well-prepared to pit themselves against competitive, no-outs and preemptive bids from other parties.

New players at the table

Heightened competition comes, in large part, from increasing interest from nontraditional tech acquirers, sovereign wealth funds and private equity firms converging on the tech market. Private equity firms, in particular, have shown an increased interest in technology assets. In fact, private equity players have more than tripled their tech investments over the past seven years (see chart below, from 451 Research).

While unicorn tech companies are attracting traditional players looking for both the technology and talent upgrades, private equity firms are more likely to bid on companies that have matured past the hype phase to a steady growth — profitable businesses, with a stable management team.

Ernst and Young

Cash-rich tech incumbents also are looking to build or buy into new technologies through joint ventures or venture arms. Technologies such as artificial intelligence, blockchain and augmented reality — which, despite their growing hype are still very early in their innovation cycle and lack a defined business model — will serve as strategic investments for buyers looking to augment their existing product lines, or hit the next S curve growth cycle.

As with new technology, increased investments in security will likely spur deal activity in a similar way. Hacks and vulnerabilities are growing, and companies within the technology sphere and beyond are looking to build solutions that improve trust and reliability. There are over 1,000 security vendors, and many companies employ two to three vendors per security vertical. We can expect to see further consolidation and deals in this subsector.

How do buyers beat competition while ensuring a fair price?

Heightened competition from private equity firms and strategic buyers will likely incite a jump in hostile and competitive bids. Tech companies should prepare to compete against these market participants by leveraging advanced analytics, evaluating synergy opportunities and carefully crafting deal narratives and integration strategies.

Carve-outs, the sale of business units or segments from larger entities, are also on the rise. These assets may be very attractive, but they carry a lot of risk and uncertainty, in particular around stand-alone costs. The sellers typically look for a speedy transaction, which may leave potential buyers nervous. Companies looking for acquisitions should not shy away from these opportunities. Instead, they should implement the same rigorous evaluation process. The employment of predictive analytics, such as revenue optimization or customer analytics, for example, can provide a clear vision of the acquirer's own value proposition for the target assets.

In sum, companies looking to buy assets this year need to have their ducks in a row. This means understanding who's looking at the same assets and how those players measure valuations. Most companies need help in doing that - both from technology tools and a trained business advisor who understands the competitive landscape. Businesses that do not do their proper due diligence ahead of the transaction often lose out on attractive assets. This scenario is completely avoidable with a diligently compiled M&A playbook fit for the buyer's organization.

Keeping tabs on market and policy changes

Excluding the possibility of geopolitical deterrents, little stands in the way for tech acquisitions this year. While there is some concern that valuations are inflated, even if stock prices were to decline, M&A conditions would remain prime. In fact, decreased valuations would likely drive further activity, because it would spur buyers to chase an attractive purchase price.

As for tax reform, the combination of the different rules is unlikely to significantly change M&A appetite as a whole. Assuming tech giants repatriate foreign cash, many believe Trump's tax plan will provide slightly better liquidity for tech companies, although it remains unclear if easy access to offshore cash will be used for share buybacks or to fuel domestic deal activity.

VMware CEO Pat Gelsinger VMware

Analysts are starting to get cranky about the impact that Dell's uncertain future is having on VMware's value.

In a note published Thursday, Barclays analysts Raimo Lenschow, Mohit Gogia, and David Rainville said they have faith in the fundamentals of VMware's business, but fear that uncertainty over whether or not a merger with Dell is imminent is creating wild swings in the stock price.

"The news has created significant volatility in the stock which may have driven some long-term fundamental investors away from VMW. Hence, we believe that these recent dynamics, added to the unorthodox VMware ownership structure could overshadow the strong fundamental momentum the business is seeing," the analysts wrote.

VMware stock, which traded at an all-time high of $150 in late January, has already seen a negative impact in the last few weeks. Shares currently cost around $125, though Barclays maintained its price target of $145.

Dell is considering a so-called "reverse merger" with the publicly-traded VMware, as a means of taking itself public without going through the usual IPO process. Dell currently owns 82% of VMware stock, and 97% of its voting interest, thanks to the 2015 Dell/EMC merger. This structure means that Dell could theoretically perform such a merger at any time, should it choose to go that route.

However, the uncertainty is accelerated by reports that Dell is also considering a more traditional IPO for itself, or just remaining a privately-owned company. All of these options are still on the table.

Should a VMware/Dell "reverse merger" go through, Barclays said that it would be an "obvious negative" for VMware shares in the near term. And in the meanwhile, uncertainty around the issue could cause some continued price volatility, analysts said.

"VMware continues to be an attractive fundamental investment given its undemanding valuation, combined with its growth and margin profile," the note reads. "We also like the company's hybrid cloud positioning here with its partnership with [Amazon Web Services]. However, we accept that the recent news flow around Dell will create more volatility in the shares until we get more clarity."

Analysts at Morgan Stanley issued a similar warning last week, calling a Dell/VMware merger a "worst case scenario" for shareholders. Morgan Stanley analyst Keith Weiss also maintained a price target of $143 for VMware in a note published Thursday.

VMware is scheduled to report financial results for its fourth quarter and fiscal year 2018 on March 1.

Amazon founder and CEO Jeff Bezos laughs as he talks to the media while touring the new Amazon Spheres during the grand opening at Amazon's Seattle headquarters in Seattle, Washington, U.S., January 29, 2018. Reuters/Lindsey Wasson

It's still remains to be seen if Amazon will get into the prescription drug business, though there have been a lot of hints. That hasn't stopped people from speculating what kind of impact they could have on the space, or even mapping out what their potential entry could look like.

"We believe that disruption is coming for healthcare and Amazon will be an accelerant of this disruption," Bernstein analyst Lance Wilkes wrote in a note Thursday. "We believe this is unusual, in that healthcare usually moves slowly, and investors have been rewarded for not being ahead of actual changes in healthcare. This time is different, we believe, because cost is now the most important consideration for payers (government and employers)."

The idea is that Amazon could come in and sell prescription drugs directly through its site, delivering them via mail and impacting retail pharmacies.

There are three ways Amazon could approach the prescription drug industry, as Bernstein sees it:

In January, Amazon along with JPMorgan and Berkshire Hathaway, launched a new independent nonprofit venture aimed at lowering healthcare costs for their employees. There weren't many details right off the bat, so it's unclear the exact approach companies will opt for. They could team up to form a health insurance plan, or find other ways to negotiate for cut backs on healthcare spending.

By banding these three self-insured employers together, Amazon's roadmap into the prescription drug business might not have to rely on partners or acquisitions of pharmacy benefits managers. Instead, Amazon could have the leverage to convince employers, starting with these three organizations, to buy into Amazon's mail service.

That large employer strategy could put Express Scripts, one of the largest standalone PBMs in the US, at even more risk than previously anticipated, Wilkes told Business Insider. If employers decide to build their own transparent PBM, they might rely less on Express Scripts' services. National account employers make up about 21% of Express Scripts' gross margin, according to Bernstein.

PBMs tend to make about one-third of their gross margin from rebates paid out for prescriptions by drugmakers, one-third from transactions happening at retail pharmacies, and one-third from their mail and specialty pharmacy services.

Should online prescriptions — particularly for recurring prescriptions — pick up market share from retail pharmacies and mail-order services start to favor Amazon, Bernstein anticipates that this threatens about 55% of Express Scripts' gross margin.

Scroll wants to make people who surf the web happySebastiaan ter Burg/Flickr

Rather than fighting people who install ad blockers, a group of publishers are banding together to help people access their websites ad free, as long as they pay up.

The Atlantic, Slate, Gannett, MSNBC.com, Fusion Media Group and Business Insider have all signed on to participate in Scroll, a soon-to-launch digital subscription product that will allow people to surf multiple websites with no ads - for $5 a month.

Scroll is the brainchild of Tony Haile, the former CEO of Chartbeat. The startup's investors include Business Insider parent company Axel Springer, News Corp., The New York Times, and now Gannett, which is joining the venture as both a strategic investor and client.

Gannett 's vast list of publications includes USA Today as well as dozens of local newspapers such as the Indianapolis Star and the Detroit Free Press.

Haile been developing the product over the past year or so. Many in the digital ad industry speculated that he'd been working on some sort of universal payment tool for publishers. Instead, the idea behind Scroll is to find a way to cater to consumers who want to enjoy a faster, cleaner web, and are willing to pay for that experience.

Scroll founder Tony Haile Scroll

And the business side, the key for Scroll is to satisfy the needs of a wide range of media companies large and small, Haile said.

Scroll promises partners that it will pay them more money per consumer than they currently make from the average visitor to their website from advertising.

"We tried to focus on both user experience and a revenue model," he said. "The hope was, 'Can we find a business model we're proud of?' and 'Can we find something that doesn't make you want to stab your eyes out when you visit websites?'"

Scroll arrives at a time when the use of ad blocking software has been on the rise, particularly in Europe. The industry has been taking a number of measures to clean up the glut of ads on most websites and mobile apps, including the Interactive Advertising Bureau's LEAN initiative (Light, Encrypted, Ad choice supported, and Non-invasive ads) and the Coalition for Better Ads, which in conjunction with Google's recent Chrome browser update promises to rid the world of annoying ads.

It won't be easy for Scroll to gain traction, considering:

Plus, there's the fact that the world doesn't know what Scroll is. Some publishers have agreed to promote the products, while others have not.

Haile acknowledged these challenges, and said he expects to sign on more publishers as the company's reputation grows among consumers.

He's also realistic about Scroll's impact. This is not going to kill the banner ad overnight. And he doesn't need to sign up the majority of the web population to be successful.

"The majority of people will still want free content with ads," he said.

Brad Smallwood.YouTube/IAB

Facebook said it's willing to knock down some of the walls from its garden. But it won't go it alone.

The social networking giant, along with Google, gets hammered a ton in ad circles for hoarding its data behind "walled gardens." The complaint among ad buyers is, as much as each company possesses incredibly powerful data that can be used for ad targeting, that data is kept inside each company's walls to a degree.

So an advertiser that wants to figure out how many customers its signing up from ads on one platform can't easily match that data up with how their ads are performing on the other.

To date, neither company has budged much on this stance, as data is such a strategic advantage for each.

But at a press event on Thursday morning, Brad Smallwood, VP of measurement and insights at Facebook, said the company would be willing to deliver some of its ad data to a neutral third party. With the help of an independent player, advertisers could then theoretically reconcile which consumers are responding to which ads across Facebook, Google, and any other data rich platform - and be a lot more strategic about how they spend their ad budgets.

The operative word being: theoretically.

Smallwood told reporters that breaking the data silos is something Facebook is working on. "It's the biggest ask we get," he said. "The challenge is how to do it ... you need an independent third party."

So does that means a data-sharing plan is plan is in the works and a third party has been tapped to help? Not quite. When pressed by Business Insider, Smallwood said that while Facebook is willing to tackle this issue, nothing is imminent. And nobody, including Facebook, wants to take such a leap without assurances that others are on board.

"We can't do it alone," he said. "We think it would be better for the industry, including us ... I can't speak for Google."

​For its part, Google says it is indeed helping marketers use better use ad targeting data outside its own properties. "​We've given agencies and advertisers access to more data than ever before with the launch of Ads Data Hub last year," said Brad Bender, VP of Product Management, Google, "They can use it to manage data from a variety of sources​ -both Google and non-Google data."​

Beyond a potential data collaboration initiative, Facebook announced a number of measurement-related moves on Thursday. The company is paring down the number of metrics that are automatically available via Facebook's Ads Manager product.

The company is also adding more language to that tool to make it clear what metrics are absolute, which are based on estimates, and which are "in development" and subject to being changed over time. Facebook has gotten some rough press of late after uncovering some errors in its metrics dashboard, as well as an embarrassing report last September that showed how Facebook's ad planning tools was promising advertisers that the platform can reach more people than actually live in the US.

In response to these issues, Facebook put together a measurement council roughly a year ago that includes representatives from big ad agencies and marketers. Ed Gaffney, who heads up research for the ad buying firm GroupM, said that those gatherings have been illuminating, and Facebook has been more responsive to advertiser needs.

"Understanding what data you've got, and how it was calculated, is the key thing going forward," he said. Of course, when it come to data, "We always want more," he said.

Disney

"Black Panther" is shattering records at the box office, and it has one Wall Street analyst rosy about the entire movie-theater business.

In its opening weekend, "Black Panther" was expected to earn $165-170 million domestically. It ended up snagging a whopping $242 million— even beating the latest "Star Wars" movie.

That's good news for the movie-theater business, which has had to combat the narrative that it's in a slow, secular decline for quite some time. In fact, it's such good news that RBC analyst Leo Kulp has updated his box-office forecast upward, and wrote in a note Thursday that the outlook for the first quarter had "improved dramatically."

"We had been expecting a 12% decline but it looks like 1Q could end up closer to flat," Kulp wrote.

He cited two reasons:

"First, Black Panther substantially outperformed our expectations. We now expect a $500mm+ domestic gross, more than double our previous $220mm estimate. Second, the flow through from late 2017 releases was much stronger than we anticipated. While Star Wars: Last Jedi ended up being light, Jumanji and The Greatest Showman were particularly strong. Several Oscar contenders like The Shape of Water, Darkest Hour, Three Billboards, etc. also contributed."

And Kulp isn't the only one in the industry who has taken notice of what the success of "Black Panther" means for the business, and particularly how it might hint at strong first quarters to come.

"The industry is certainly moving towards a more balanced release calendar," Jeff Bock, a senior analyst for Exhibitor Relations, told Business Insider recently. "Old Hollywood adages are being thrown out the window because audiences, no matter what season, have an insatiable appetite for event films — provided they deliver the goods."

Kulp also said the second quarter was looking "even stronger" than it had been for the movie-theater business.

But Kulp's optimism doesn't extend to the second half of the year.

He wrote that much of the content in the second half of 2018 is "either untested content designed to appeal to younger audiences (like Peter Jackson's steam punk film Mortal Engines) or remakes of older IP that we aren't convinced resonates."

President Donald Trump. AP

At a moment when many are trying to figure out how to prevent another school shooting, President Trump believes we need to look at video games and movies that young people are consuming.

During a meeting in the White House about school safety on Thursday, President Trump said that today's video games and movies are "so violent," and that the rating systems for both need to be reexamined.

"The level of violence on video games is really shaping young people's thoughts, and then you go the further step, and that's the movies," Trump said. "You see these movies, they're so violent, and yet a kid is able to see the movie. If sex isn't involved, but killing is involved. And maybe they have to put a rating system for that, and you get into a whole very complicated, very big deal."

There are currently rating systems for both movies and video games. The Motion Picture Association of America has a rating system that's used at movie theaters nationwide. For video games, they are conducted by the Entertainment Software Rating Board.

This is hardly the first time both mediums have come under fire after a violent act. But it's the victims of this latest school shooting that are coming out to say it's not the content that's causing the violence.

"My friends and I have been playing video games our whole lives, and seen, of course, violent movies, but never have we ever felt driven or provoked by those action in those games to do something as horrible as this," Samuel Zeif, a Stoneman Douglas High School shooting survivor, said on CNN soon after Trump made the remarks. "It's a video game, something happens you restart, we know that's not how life is. I think it's a distraction, the president is trying to distract us."

Fellow survivor, Chris Grady, gave stronger words about Trump's comments.

"That's just a really pathetic excuse on behalf of the president," he told CNN. "I grew up playing video games — 'Call of Duty,' those first-person shooter games — and I would never, ever dream of taking the lives of any of my peers. So it's just pathetic."

Since the Florida shooting, students across the country have rallied for stricter gun-control measures. Protests have been held, and there's a planned national school walkout on March 14, and a "March for Our Lives" protest on March 24.

The National Association of Theatre Owners declined to comment for this story. The Motion Picture Association of America and Entertainment Software Rating Board did not respond to Business Insider's request for comment.

Here's President Trump's comments on there being too much violence in video games and movies:

Imran Khan, Snap's chief strategy officer Dave Kotinsky/Getty Images

Snap gave CEO Evan Spiegel a gargantuan stock award last year.

More quietly, it also handed out a jumbo-sized award to Imran Khan, its chief strategy officer.

In January 2017, mere days before Snap went public, the company handed out $100 million worth of restricted shares to Khan, the company disclosed in its annual report, made public Thursday. The shares — some 6.1 million of them — will vest over the next 10 years.

"This ... grant was a one-time performance award granted to Mr. Khan," the company said in its annual report.

The award was the second major stock grant given by Snap to Khan. The company also gave him a $145 million stock grant in 2015, according to the registration statement it filed before going public.

Khan was one of at least three Snap executives that received large stock awards last year. Most notable was that granted to Spiegel. At the time of its initial public offering, the mobile app maker gave Spiegel 34 million shares worth $637 million.

Snap had previously disclosed the relative size of the stock award it planned to give Spiegel in conjunction with its IPO, but not the value of that award. Unlike Khan's grant, Spiegel's vest over a three-year period.

Snap CEO Evan Spiegel. Michael Kovac/Getty Images for Vanity Fair The company also handed out a one-time grant of 2.2 million shares in May to Chris Handman, Snap's general counsel at the time. Those shares were worth $53.8 million when they were granted and will vest over the next 10 years. Handman, however, left the company in August and now serves as an outside advisor. If Snap cancels that contract, he could lose the bulk of his award.

Snap's disclosures about executive compensation come as the company's stock has taken a hit due to criticism about a recent redesign of its core Snapchat app. The company has struggled to impress Wall Street since going public, although it did top expectations with its most recent quarterly report.

The company's governance and compensation practices have long drawn the scrutiny of certain investors. Snap has a multiclass stock structure that allots no votes to common shareholders, and, instead, grants outsized control to Spiegel. He and fellow co-founder Robert Murphy together have nearly 96% of the voting power at Snap.

In addition to the massive stock award, Snap paid Spiegel $98,078 in salary last year and $1.08 million in "other compensation." That latter figure includes $561,892 in security-related costs, which was down from the $890,339 it paid for such expenses in 2016.

Khan, meanwhile, received $441,923 in salary last year and $69,728 in "other compensation," which included relocation expenses.