Apple fights €1.8 bn EU antitrust fine for curbs on Spotify
Apple Inc. is challenging a €1.8 billion ($1.9 billion) fine levied by the European Union for thwarting fair competition from musicstreaming rivals, including Spotify Technology SA.
The iPhone maker has filed a suit at the EU’s General Court in Luxembourg to topple the March decision, according to people familiar with the matter who spoke on condition of anonymity.
The EU’s crackdown on Apple also included an order to stop preventing musicstreaming apps from informing users of cheaper deals away from its App Store. The investigation was sparked by a complaint half a decade ago from Stockholmbased Spotify, which claimed it was forced to ramp up the price of its monthly subscriptions to cover costs associated with Apple’s alleged stranglehold on how the App Store operates.
The European Commission, the EU’s antitrust arm, said it stands ready to defend all its decisions in court.
Apple declined to comment other than pointing to an earlier blog post in which it said that EU regulators failed to uncover any credible evidence of consumer harm.
Apple’s appeal sets up yet another court battle with the EU regulator, which previously slapped the Cupertino, California-based company with a record €13 billion tax bill in a dispute over Irish state aid. The final outcome is still pending after Apple won an early round.
Silicon Valley firms have been on the receiving end of a campaign by EU competition chief Margrethe Vestager to tame their dominance through fines and regulatory actions, including a landmark new law — the Digital Markets Act. The new rules establish a raft of dos and don’ts for some of the world’s most powerful tech firms. To bring it in line with the rules, Apple has been forced to overhaul its iOS, Safari and App Store offerings in the EU. Apple has mounted further court challenges against the regulation.
Aweek ago, Google unveiled Veo, a new generative AI video model. In some ways, this was the search giant's direct salvo at younger upstart and rival, OpenAI’s Sora, which was introduced this February.
Both claim to generate cinematicgrade video clips with just a few words of text. While this has sparked debate around AI’s impact on creative industries such as filmmaking and advertising, early reactions to their muchtouted ‘magical’ abilities are lukewarm.
According to three content creators and three filmmaking and advertising veterans that Mint spoke with, although neither Veo nor Sora are available to try in India currently to test properly and raise a verdict, they appear a bit underwhelming, and may not become mainstays for video production.
Instead, the footage generated by such AI models may at best be used to visualize scripts at the pre-production stage, or create filler or ‘B-roll’ content that is used for background purposes in longer, more expansive movies and advertisements.
To be sure, Sora and Veo are not the only ones. On 27 January, Google Research unveiled Lumiere—a new text-based AI model that claimed to “portray realistic, diverse and coherent motion”.
Beyond Big Tech, startups have made generative video tools available to the general public to fiddle with for more than a year now—from UK-based Synthesia’s Express-1 model to New York-headquartered Runway’s Gen-2 model. Google, meanwhile, invested in Runway’s $141-million funding round last June. These show serious potential for generative AI video.
Both OpenAI and Google claim that multi-modality of their video generation models—the ability to support input prompts in more than one format, including text, audio or images— is a key ability. Given Big Tech’s might and vast resources of computing and data available at hand, this can make for a serious resource for creative professionals to either leverage, or contend with. For instance, Bengalurubased technology content creator Varun Mayya, who has a cumulative following of nearly 2.2 million viewers across his multiple Instagram and YouTube channels, uses AI to generate filler footage as well as piece-tocamera videos for many of his content.
While Mayya focuses on AI-based educational video content for developers and engineers, he has also used AI to gain assistance in his video production schedule.
Unlike Mayya, many others keep away. Two other content creators, who work closely with YouTube and requested anonymity to protect their respective brand partnerships, said that generative video platforms may not be comprehensive and could lead to branding complications.
“Brands may not prefer knowing that any specific video was used with generative AI—there is a fear in the market that using AI videos could lead to copyright lawsuits, and no commercial entity wants such complications. This is a hindrance right now in India, at least until there is regulatory and legal clarity,” one of the creators told Mint. Each of these creators, however, confirmed that generative AI is well and truly being used in India at more than an experimental pace. While the early mood is anticipatory, it is also lukewarm—some cite quality issues, while others are concerned about intellectual property infringements.
“Most content creators sign originality agreements with clients. For them, if the material used to train a generative AI model belongs to a third party, and this reflects in the output,
The iPhone maker has filed a suit at the EU’s General Court in Luxembourg to topple the March decision
Stock gains
Equity awards continued to make up the bulk of most executives’ pay, much of it structured to deliver more stock or options if the company meets financial or share-price performance over several years. That means the pay can lose considerable value if the company’s share price falls or operating targets are missed—or soar in value amid market and operating success.
Restricted stock awarded in early March last year to Jensen Huang, CEO of graphics-chip maker Nvidia, quadrupled in value through late January, to $107.5 million. Huang’s pay, originally reported at $34.2 million, included $26.7 million of restricted stock as valued at grant.
Under the terms of the award, Huang could receive 50% to 100% more shares than originally targeted if the company meets performance criteria, according to Nvidia’s proxy.
Nvidia’s share price tripled during the year.
Brian Niccol, CEO of restaurateur Chipotle Mexican Grill, received stock and options valued at $15.5 million when they were granted in February 2023 as part of a $22.5 million pay package. By the end of the year, that equity had more than tripled in value, to $52.2 million, the company said. Chipotle shares returned about 65% during 2023, and 18% a year over three years.
A Chipotle spokeswoman said the growth in Niccol’s equity-award value reflects the company’s strong share-price performance during the year. The company said the value Niccol ultimately realizes depends on continued financial, operating and stock-market performance by the company.
Intel CEO Patrick Gelsinger’s equity awards last year also more than tripled in value by year-end, to $39.3 million. The company said in its securities filings that austerity measures last year reduced Gelsinger’s salary by about 15% to $1.1 million, which in turn reduced his cash bonus target by about 15%, to $2.9 million.
Overall, median cash pay for CEOs, including salary and annual bonuses, remained flat at about $3.8 million. Top performers
Pay for CEOs running the best- and worst-performing companies didn’t vary dramatically. Median total pay was $14.6 million for the 20% of CEOs whose companies recorded the worst returns compared with other companies in the same sector, and $15.7 million for CEOs at the best-performing companies.
Chip and computer hardware makers accounted for six of the 25 bestperforming companies—including Nvidia, the top performer—while four were in the travel or transportation industries. Several of the top performers bounced back from one or more years of poor returns, often tied to the pandemic.
Royal Caribbean Group reported paying Jason Liberty $17.2 million and recorded a total return of 162% last year, after posting minus 36% in 2022 and minus 43% in 2020, when the cruise industry was battered by illness and travel bans. (The company posted a 3% return in 2021.) Ride-sharing giant Uber Technologies recorded a 149% return after posting returns of minus 41% in 2022 and minus 18% in 2021.
Chip maker Advanced Micro Devices, ranked seventh by one-year performance, was headed by Lisa Su, the second-highest-paid woman in the analysis, at just over $30 million, including nearly $28 million in restricted stock and options. The highest-paid woman, at $31.55 million, was Julie Sweet of consultant Accenture, which posted a one-year total return of about 14%.
Thirty-one women ran S&P 500 companies for the full year of 2023, up from around two dozen at the beginning of the decade. None ranked among the top 25 by pay. One other woman ran one of the 25 best performers: Jayshree Ullal at networking company Arista Networks,
Bottom of the pack
Among the 25 worst-performing companies in the Journal analysis, nearly a third operated in the healthcare sector, including six pharmaceutical or biotech companies. They were joined by four utilities.
Pfizer said it didn’t pay bonuses to top executives last year after weak demand for Covid-related products led the company to miss financial targets. The $17.5 million equity award that made up most of CEO Albert Bourla’s total pay last year is meant to recognize his leadership and give him an incentive to focus on long-term strategy, the company said.
Poor performance can slash the value of CEO equity awards. Covidvaccine maker Moderna reported total pay of $17.1 million for CEO Stéphane Bancel last year, including $12.5 million in stock and option awards.
The value of those awards fell 42% to $7.3 million at year-end, the company’s proxy shows, as Moderna’s stock price tumbled about the same amount for the year. In addition, equity awards made to Bancel in prior years fell in value by about $167 million during 2023.
Those losses offset a net $945 million in new equity awards and increases in value reported for Bancel during the prior three years. Moderna declined to comment. Methodology
The Wall Street Journal used data from corporate proxy statements filed through May 16 by companies in the S&P 500 index with fiscal years ended after June 30, 2023. The data was collected by MyLogIQ, a provider of public-company data and analysis.
Aggregate pay and shareholder-return figures exclude companies that changed CEOs or fiscal-year-end dates during the year.
Pay reflects the value of equity awards at grant, as reported by companies. Total returns reflect stock-price change and dividends, in most cases calculated from the month end closest to the company’s fiscal-year end.
Sources: MyLogIQ (compensation); Institutional Shareholder Services, FactSet (shareholder return); Standard & Poor’s (industry groups); company filings (pay for select companies)
Median total pay was $14.6 mn for 20% of CEOs of firms with worst returns, $15.7 mn for CEOs at bestperforming firm