Cable industry offers low-income rates

NEW YORK — Cable companies said Wednesday that they will offer Internet service for $9.95 per month to homes with children that are eligible for free school lunches.

The offer will start next summer and is part of an initiative the Federal Communications Commission cobbled together to get more U.S. homes connected to broadband.

One third, or about 35 million homes, don’t have broadband. That affects people’s ability to educate themselves and find and apply for jobs, FCC Chairman Julius Genachowski said.

“The broadband adoption gap in the U.S. is very large, and the costs of digital exclusion are high and getting higher,” Genachowski said.

The initiative, called Connect-to-Compete, also includes Microsoft Corp., which pledges to sell PCs with its Office software suite for $250 to low-income families. A firm called Redemtech is offering to sell refurbished computers for $150, including shipping.

For those who can’t afford those prices, Morgan Stanley is pledging to develop a microfinance lending program for community-based financial institutions.

All major cable companies are standing behind the $9.95 offer, which will be valid for two years. The price doesn’t include taxes, but the companies are pledging to charge nothing for installation or rental.

Privacy is now No. 1 issue for Facebook

SAN FRANCISCO -- Facebook Inc.’s expected settlement with the Federal Trade Commission is sending a strong message to Internet companies that regulators are getting serious about protecting the privacy of consumers.

The social networking giant could announce a deal with the FTC as early as today over charges that it violated users’ privacy when it changed default settings to make more of their information public.

The settlement taps into growing public concern over online privacy and signals more aggressive enforcement from regulators.

And it appears the message is coming through loud and clear in the corner offices of Silicon Valley and beyond — especially as Internet companies prepare for potentially lucrative initial public offerings.

“Privacy now has the potential to affect the bottom line, which has gotten the attention of CEOs,” said Lisa Sotto, head of the global privacy and information practice at the law firm of Hunton & Williams.

For years online privacy was a sleepy issue hashed out by anonymous lawyers in back rooms. But the explosion of Web usage — and the speed and volume with which data can be transmitted around the globe — has moved the public debate over online privacy to the forefront.

Lawmakers and regulators have responded with pledges to address how Internet companies collect personal information and what they do with it.

The FTC has called for a “do not track” system to make it easier for Internet surfers to keep companies from snooping on their Web activities. The Obama administration has asked for an online privacy bill of rights, while Congress has introduced more than a dozen privacy bills so far this year.

In the cross hairs is Facebook, the wildly popular social network with more than 800 million users that is preparing for a possible IPO that could value the company at up to $100 billion.

Changes to its privacy policies over the years have led to a flood of complaints from consumers concerned over how Facebook handles their personal information. Facebook is also under scrutiny in the European Union for possible breaches of personal data.

“Facebook has to expand its data collection practices to satisfy its largest advertisers to boost the IPO share price. But it also has to appease privacy regulators in the U.S. and the European Union, whose actions could derail Facebook’s pending financial bonanza,” said Jeffrey Chester, executive director of the Center for Digital Democracy, one of the consumer groups that complained to the FTC. “It appears Facebook is poised to neutralize any threats to its future coming from U.S. regulators.”

The proposed settlement with the FTC would prohibit Facebook from making public information that a user originally shared privately without his or her explicit permission. It does not require Facebook to get consent from its users on new sharing features. As part of the settlement, Facebook would have to agree to 20 years of privacy audits.

The settlement stems from a complaint filed by the Electronic Privacy Information Center in December 2009, which asked the FTC to investigate whether consumers were harmed when Facebook changed its privacy settings to disclose more personal information without first getting their permission.

Electric car battery fire draws scrutiny

WASHINGTON — A Chevrolet Volt that caught fire three weeks after its lithium-ion battery was damaged in a government crash test has regulators taking a harder look at the safety of electric car batteries.

The car that caught fire was tested May 12 by a National Highway Traffic Safety Administration contractor at a Wisconsin facility using a relatively new side-impact test intended to replicate crashing into a pole or a tree.

Three weeks later, while the car was parked at the test facility, it caught fire. A NHTSA investigation concluded the crash test damaged the battery, which later led to the fire.

Lithium-ion batteries, which are used in a vast array of consumer electronics, have a history of sometimes catching fire when damaged.

Other companies report no fires

Nissan Motor Co. ,which has more than 8,000 all-electric Leaf models on U.S. roads, and Tesla Motors Inc., with 2,000 cars sold worldwide, said their cars are extensively tested and have not started any fires after crashes.

General Motors spokesman Greg Martin said the test did not follow procedures developed by GM engineers for handling the Volt after a crash. The engineers tested the Volt’s battery pack for more than 300,000 hours to come up with the procedures, which include discharge and disposal of the battery pack, he said.

“Had those protocols been followed after this test, this incident would not have occurred,” he said.

The company had not told the government of its protocols at the time of the test, another GM spokesman said.

Martin said the Volt is safe. After the Volt fire, NHTSA and GM each replicated the crash test and waited three weeks, but in neither case did the cars catch fire, officials said. Nor were the cars’ batteries damaged in those tests, officials said.

NHTSA is also asking manufacturers who currently have electric cars on the market, or who plan to introduce electric vehicles in the near future, for information on what procedures they have established for discharging and handling batteries, including recommendations for reducing fire risks.

“NHTSA is focused on identifying the best ways to ensure that consumers and emergency responders are aware of any risks they may encounter in electric vehicles in post-crash situations,” the agency said in a statement.

“Ultimately, we hope the information we gather will lay the groundwork for detailed guidance for first-responders and tow truck operators for use in their work responding to incidents involving these vehicles,” the agency said.

Coolant leak

After the crash test, NHTSA found a coolant leak and moved the damaged Volt to a back lot, where it was exposed to the elements, said Rob Peterson, a GM spokesman who specializes in electric cars.

Exposure to the weather caused the coolant to crystalize, and that, combined with the remaining charge in the battery, were factors, he said.

NHTSA did not drain the battery of energy as called for under GM’s crash procedures. But at the time, GM had not told the agency of its protocols, Peterson said. NHTSA normally drains fuel from gasoline-powered cars after crash tests, he said.

In a real-world crash, GM would be notified through its OnStar safety communications system and would send a team out to remove the battery for research purposes, he said. The safety of the Volt, which earned a top five-star crash safety rating from NHTSA, “really isn’t being questioned,” Peterson said.

Lithium-ion batteries have been the subject of several recalls of consumer electronics. Millions of laptop batteries made by Sony Corp. for Apple Inc., Dell Inc., Lenovo Group Ltd. and other PC makers were recalled in 2006 and 2007.

Rehab Practice Management makes acquisition in California

Rehab Practice Management LLC said it has acquired Desert Physical Therapy and Sports Medicine, which provides outpatient physical therapy services in Apple Valley, Calif.

Terms of the transaction weren’t disclosed.

With the acquisition of Desert Physical Therapy, Franklin-based Rehab Practice now has four locations in Southern California’s high desert area.

Earlier this year, the provider of rehabilitation management and therapy services acquired another provider of outpatient physical therapy services in Barstow, Calif.

Grease thieves cash in

ROCK HILL, MO. — Bobby Tessler’s temper sizzled just as much as his chicken wings as he stood over his deep fryers Tuesday and thought about the money that recently greased the pockets of thieves instead of his own.

Since he opened his business St. Louis Wing Co. in April, thieves have siphoned hundreds of pounds of grease from a container behind his business, depriving him of about $2,000 that a grease rendering company would have paid him.

“It’s a big deal. There’s a huge underground out there for this stuff,” he said.

Grease thefts have been on the rise since the introduction of biofuels to the market once dominated by animal feed and soap industries. Combating the thefts is difficult because the penalties are minimal despite environmental and financial concerns, said Tom Cook, president of the National Renderers Association.

“Others have said that this is like the new copper,” Cook said. “These thieves are getting more sophisticated. It’s a multimillion-dollar business for them.”

Empty container

Tessler knew something was amiss after he called his rendering company to ask why he had not been paid for the grease he had put in their container during the first six months he was open.

“They told us our container never had anything in it,” he said.

He called police, who then spotted three teenagers removing grease from Tessler’s restaurant and other restaurants in the early hours of Sept. 26. Rock Hill police have arrested one of those three, said Capt. Jorden Lewis.

The suspect, 19, has yet to be charged, but told police that he paid his 17- and 18-year-old accomplices to be lookouts and help keep him awake, Lewis said. He told officer Kevin Clinton that he was from the Springfield, Mo., area.

He also told police that he worked for a legitimate grease rendering company but had been stealing grease from businesses in Arkansas and the St. Louis area to make money on the side.

In a separate case, brothers Gary and Ryan Vaughn were charged with misdemeanor theft after stealing grease from a Chinese restaurant in the St. Louis area. The pair also said they were from Springfield, Mo. The owners of Hong Kong Express said St. Louis police caught the two on surveillance cameras stealing grease Nov. 2.

Nobody cares

News of the arrests and charges isn’t encouraging to local rendering companies, such as Belleville-based Kostelac Grease Service.

“It’s a crime that nobody really cares about,” said John Kostelac, who co-owns the business with his brother, Jim Kostelac. “When copper thieves get caught they are sent to prison, but when somebody gets caught stealing grease, they get a slap on the hand and are turned loose and are out stealing again.”

Tell-tale signs

Kostelac said his drivers can tell when a business has been hit because the thieves often leave a greasy mess behind. They usually have 1,000-gallon tanks on trucks and do not carry cleaning supplies with them in case of a spill, he said.

It’s also hard to estimate the value of the stolen grease. It is a commodity; the purer the product, the more it is worth, Kostelac said.

Electric car battery fire draws scrutiny

WASHINGTON — A Chevrolet Volt that caught fire three weeks after its lithium-ion battery was damaged in a government crash test has regulators taking a harder look at the safety of electric car batteries.

The car that caught fire was tested May 12 by a National Highway Traffic Safety Administration contractor at a Wisconsin facility using a relatively new side-impact test intended to replicate crashing into a pole or a tree.

Three weeks later, while the car was parked at the test facility, it caught fire. A NHTSA investigation concluded the crash test damaged the battery, which later led to the fire.

Lithium-ion batteries, which are used in a vast array of consumer electronics, have a history of sometimes catching fire when damaged.

Other companies report no fires

Nissan Motor Co. ,which has more than 8,000 all-electric Leaf models on U.S. roads, and Tesla Motors Inc., with 2,000 cars sold worldwide, said their cars are extensively tested and have not started any fires after crashes.

General Motors spokesman Greg Martin said the test did not follow procedures developed by GM engineers for handling the Volt after a crash. The engineers tested the Volt’s battery pack for more than 300,000 hours to come up with the procedures, which include discharge and disposal of the battery pack, he said.

“Had those protocols been followed after this test, this incident would not have occurred,” he said.

The company had not told the government of its protocols at the time of the test, another GM spokesman said.

Martin said the Volt is safe. After the Volt fire, NHTSA and GM each replicated the crash test and waited three weeks, but in neither case did the cars catch fire, officials said. Nor were the cars’ batteries damaged in those tests, officials said.

NHTSA is also asking manufacturers who currently have electric cars on the market, or who plan to introduce electric vehicles in the near future, for information on what procedures they have established for discharging and handling batteries, including recommendations for reducing fire risks.

“NHTSA is focused on identifying the best ways to ensure that consumers and emergency responders are aware of any risks they may encounter in electric vehicles in post-crash situations,” the agency said in a statement.

“Ultimately, we hope the information we gather will lay the groundwork for detailed guidance for first-responders and tow truck operators for use in their work responding to incidents involving these vehicles,” the agency said.

Coolant leak

After the crash test, NHTSA found a coolant leak and moved the damaged Volt to a back lot, where it was exposed to the elements, said Rob Peterson, a GM spokesman who specializes in electric cars.

Exposure to the weather caused the coolant to crystalize, and that, combined with the remaining charge in the battery, were factors, he said.

NHTSA did not drain the battery of energy as called for under GM’s crash procedures. But at the time, GM had not told the agency of its protocols, Peterson said. NHTSA normally drains fuel from gasoline-powered cars after crash tests, he said.

In a real-world crash, GM would be notified through its OnStar safety communications system and would send a team out to remove the battery for research purposes, he said. The safety of the Volt, which earned a top five-star crash safety rating from NHTSA, “really isn’t being questioned,” Peterson said.

Lithium-ion batteries have been the subject of several recalls of consumer electronics. Millions of laptop batteries made by Sony Corp. for Apple Inc., Dell Inc., Lenovo Group Ltd. and other PC makers were recalled in 2006 and 2007.

Groupon shares soar 30 percent in public debut

NEW YORK — Groupon, the company that pioneered online group discounts, saw its stock rise about 30 percent in its public debut Friday, showing strong demand for an Internet company whose business model is considered unsustainable by some analysts.

Groupon’s stock initially jumped as high as $31.14 per share — or nearly56 percent — from its opening price of $20 a share before losing some steam.

Shares closed a little down from that, finishing its first session of Nasdaq trading at $26.11 per share on a day when the Dow Jones industrial average lost 0.5 percentage points and failed to crack the 12,000-point level.

Big fluctuations are common for fresh public companies, and Groupon’s first-day rise was largely expected. What happens next is the bigger question.

Analysts said this doesn’t ease worries about the risks concerning the company — especially as the stock price increases.

“Until investors see the full profit model unfold over time, expect this stock to be highly volatile with increasing risk as the market cap rises,” said Kathleen Shelton Smith, principal of Renaissance Capital, which operates IPOhome.com. “The first day of trading is typically more about supply and demand. Fundamentals will take over in the long run.”

Groupon has faced scrutiny about its high marketing expenses, enormous employee base and even the way it accounted for revenue until an SEC inquiry prompted a restatement.

Chicago-based Groupon Inc. sends out frequent emails to subscribers offering a chance to buy discount deals for anything from laser hair removal to weekend getaways. The company takes a cut of what people pay and gives the rest to the merchant.

Though it’s spawned many copycats after its 2008 launch, Groupon has the advantage of being first. This has meant brand recognition and investor demand, as evidenced by its sizzling public debut.

The stock is trading on the Nasdaq Stock Market under the symbol “GRPN.”

“This is not Facebook where they can do no wrong,” said longtime IPO analyst Scott Sweet, the owner of IPO Boutique. He called Groupon an “accident waiting to happen.”

Sweet is among analysts who question Groupon’s business model, its high marketing expenses and frantic hiring pace that has swelled its ranks to more than 10,000 employees.

Still, the sale of its 35 million shares means Groupon’s initial public offering of stock raised about $700 million, minus investment banking fees, etc.