San Bruno officials are urging the utility to make good on its promise to pay the city restitution for the September 2010 blast, which killed eight people, destroyed 38 homes and laid waste to the Crestmoor Canyon neighborhood.

City spokesman Sam Singer said Wednesday that San Bruno officials have been negotiating a settlement officials including PG&E President Chris Johns since last fall. But he said the utility abruptly walked away from the negotiating table last week.

That settlement would be in addition to a trust fund PG&E created to pay up to $70 million to help the city cover the cost of rebuilding.

 (Copyright 2012 by CBSSan Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

Its adjusted earnings and revenue skidded past Wall Street’s expectations, but that wasn’t enough to lift the stock of the company behind the most popular games played on Facebook. Zynga’s stock fell 6 percent in after-hours trading following its report.

San Francisco-based Zynga said Tuesday that it lost $435 million, or $1.22 per share, in the fourth quarter. That’s down from earnings of $16.1 million, or 5 cents per share, a year earlier when it was still privately held.

Adjusted earnings were 5 cents per share in the latest quarter, surpassing Wall Street’s expectations by 2 cents. This figure excludes one-time items, including $510 million in stock-compensation expenses triggered by Zynga’s initial public offering of stock in mid-December.

Revenue rose 59 percent to $311 million as Zynga grew its user base, ad revenue and the money it makes from games such as “CityVille,” “FarmVille and “Zynga Poker.” Analysts surveyed by FactSet were expecting $302 million.

Zynga’s IPO raised $1 billon, at the time the largest U.S. IPO by an Internet company since Google’s in 2004. Facebook, though, is expected to dwarf both when it goes public in the next few months. The world’s largest online social network plans to raise $5 billion in an IPO that could value the company at as much as $100 billion. In comparison, Zynga’s market capitalization was about $10 billion as of Tuesday.

Zynga relies on its Facebook games for nearly all of its revenue, though it has been working on expanding to other areas, notably mobile devices. “Words With Friends,” a Scrabble-like game played mainly on smartphones, is one of its best-known titles. Of the 12 games Zynga launched last year, eight were for mobile devices.

The company said it had 54 million daily active users in the fourth quarter, up 13 percent from 48 million a year earlier.

“Zynga set new records in the year in terms of audience size, revenues and bookings,” CEO Mark Pincus said in a statement. “We saw great momentum in mobile and advertising and ended the year with a strong pipeline of new games.”

For all of 2011, Zynga lost $404 million, or $1.40 per share, down from earnings of $27.9 million, or 11 cents per share, in 2010. Revenue nearly doubled to $1.14 billion from $597 million.

The company expects adjusted earnings of 24 cents to 28 cents in 2012. Analysts are forecasting earnings of 23 cents per share.

Getting no Valentine’s Day love from investors, Zynga’s stock fell 87 cents, or 6.1 percent, to $13.48 in after-hours trading Tuesday. The stock closed up 93 cents, or nearly 7 percent, at $14.35. Zynga’s stock price has ranged from $7.97 to $14.44 since its IPO, which priced at $10.

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A person familiar with the matter confirmed the impasse Tuesday. The person spoke on condition of anonymity because Yahoo’s efforts to sell its stakes in China’s Alibaba Group and Yahoo Japan are confidential.

All Things D, a technology blog affiliated with The Wall Street Journal, reported earlier that the talks had collapsed. It’s the latest twist in the drama that has been swirling around Yahoo Inc. since the troubled Internet company fired Carol Bartz as CEO five months ago.

Since the start of the year, Yahoo has hired Scott Thompson as CEO and announced the departures of five board members.

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In fact, NASA is proposing a $20 million budget increase for the facility.

“In this budget environment, that is very good news for NASA Ames in particular,” said NASA Ames Director Pete Worden. “Ames is in space and Ames is in the air. We are the leader for a lot of critical technologies, and this budget only strengthens that.”

KCBS’ Mike Colgan Reports:

Worden said that what’s saving NASA Ames from the budget axe is that the facility is involved in so many different key projects.

“One of the particular areas that has been strengthened in this is the entry, descent and landing systems. I like to say that if you want to get to space, you probably talk to some other center,” said Worden. “But if you want to come home, you better talk to us, because we know how to do the thermal protection systems.”

Ames is also heavily involved in robotic technology.

NASA announced a $17.7 billion budget request on Monday for fiscal year 2013.

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A recent CBS 5 investigation found thieves openly selling phones on the street. Could it also be happening in stores?

CBS 5 went undercover taking five iPhones to five wireless stores to see what would happen if we tried to sell them. Everywhere we went clerks were all too eager to buy them, no questions asked.

Police say they’re doing what they can, but what about the industry? Carriers like to tout their smartphone recovery apps, but thieves can thwart them by turning the phone off.

What could work is blocking a stolen phone, something other countries are doing.

Chris Althaus with the Australian Mobile Telecommunications Association explained how his country’s “lost and stolen” program works. “It’s a blocking system using a 15 digit IMEI number that is attached to every mobile device,” he said. “Someone who steals a phone, that phone is blocked across all 3 networks in this country and is essentially rendered useless.”

Althaus said the program has reduced smart phone thefts by 25 percent in Australia. So why not use a similar system in the U.S.?

CBS 5 asked John Null with the U.S. wireless industry’s CTIA. “We don’t believe it’s feasible,” he said.

“Shared databases are notoriously very hard to maintain. Plus, there’s a huge consumer nuisance factor as well.” Null said. He added the system is not foolproof. “The ID numbers can be changed. Criminals are quite resourceful in that respect.”

But Althaus said in Australia he doesn’t see that happening.

Cody Hunt at CeX in Berkeley agrees. “As far as actually changing the IMEI number I have yet to see that,” he said.

His store is part of a worldwide chain that buys and sells used electronics, and abides by strict pawn shop regulations. Anyone who comes in wanting to sell a phone gets thoroughly checked.
Customers even get fingerprinted. Serial numbers get checked and run through a police database.

It makes Hunt wonder why the cellphone industry couldn’t provide a database as well. “It’s either laziness or other means of profit I guess,” he said. “They sell more phones because you lose more phones.”

When CBS 5 asked the CTIA’s John Null about it, he said, “Well that’s an interesting way to look at it, not one that I have considered, frankly.” He said if a practical solution comes up, the industry would be happy to adopt it, because the goal is to keep customers happy.

But for now it’s the status quo, making smartphone thieves the happy ones.

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At the time George Merrill and Shannon Rubicam wrote “How Will I Know,” Houston was a relative unknown just creating her first album. The song was originally meant for Janet Jackson, but then Merrill and Rubicam heard Houston sing their lyrics.

“We just basically sat down and wrote what we thought would be a good song,” recalled Rubicam.“It was clear as soon as I heard it over the phone with George…we just went, ‘Oh my god.’”

Houston, and producer Narada Michael Walden, would turn their words into hits. It was in Walden’s San Rafael studio that 7 of Houston’s number 1 hits were produced. The proof adorns the walls at Tarpan Studios.

Walden worked closely with Houston from her first album through the monstrous success of the ‘Bodyguard’ soundrack.

“We are so grateful to have been a part of her legacy,” Walden said via Facebook.

Merrill and Rubicam said the end for Houston came too soon for the young girl that they knew, but she gave them memories that they’ll never forget.

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Amid growing criticism over labor and environmental practices -especially in China- Apple, last month, disclosed a list of suppliers for its popular gadgets for the first time.

The FLA team began the inspections Monday morning at Foxconn City in Shenzhen, China, Apple said Monday. The complex employs and houses hundreds of thousands of workers.

Related Coverage:
Apple Stock Breaks $500 Level, Continuing Rally

Foxconn, a unit of Taiwan’s Hon Hai Precision Industry Co. employs an estimated 1 million to 1.1 million people in China at a series of huge factory campuses. Foxconn assembles iPads and iPhones for Apple, Xbox 360 gaming consoles for Microsoft and other gadgets for companies including Hewlett-Packard and Dell.

In 2010, there was a rash of suicides at Foxconn’s Shenzhen plant. Plant managers installed nets to prevent more people from committing suicide by jumping from the roof. A May explosion at the company’s Chengdu, China, plant killed three people and injured 15. A New York Times story published Jan. 26 reported on accidents and long hours in Foxconn factories, based on workers’ accounts. Foxconn disputed allegations of back-to-back shifts and crowded living conditions.

Cupertino-based Apple has been conducting its own audits of working conditions at factories where its gadgets are assembled since 2006. A month ago, it took the additional step of joining Washington-based FLA, a group of companies and universities focused on improving labor practices.

Apple, the most valuable company in the world, is the first technology company to become a member. It committed, at the time, to have the FLA inspect its suppliers, who have pledged full cooperation. The FLA plans to interview thousands of employees at several Apple suppliers about working and living conditions. The audits will cover facilities where more than 90 percent of Apple products are assembled.

The FLA’s findings and recommendations will begin to be posted on www.fairlabor.org in early March.

Apple’s sales have zoomed even as working conditions at its suppliers have drawn more attention. In the October to December quarter, it sold 37 million iPhones and 15 million iPads

Consumer activism site Change.org gathered 200,000 signatures for a petition to ask Apple to protect workers around the time of new product releases, when the workload spikes. Activists hand-delivered printouts of the signatures to Apple stores last week, but the group has stopped short of arranging protest gatherings or calling for a boycott.

Meanwhile, investors keep bidding up the company’s shares in the wake of the company’s staggering sales and profit over its holiday quarter. Apple’s stock surpassed $500 for the first time Monday, giving the company a market capitalization of $465 billion. Exxon Mobil Corp., which has been trading the No. 1 position with Apple since last summer, has a $400 billion market cap.

The shares hit $503.83 soon after opening, before subsiding to $502.60 in after-hours trading. That was up $9.18, or 1.9 percent, from Friday’s close.

Apple Inc. and Exxon Mobil Corp. have been vying for the position as most valuable company in the world since last summer, but the latest rally has made the gadget maker 17 percent more valuable than the oil company. Its market capitalization is now $465 billion, compared to Exxon’s $400 billion.

On Jan. 24, Apple posted net income of $13.06 billion for the quarter that ended in December, more than doubling its profits from the year before. Sales were $46.3 billion, up 73 percent from a year ago.

Even before it posted blow-out results, Wall Street analysts had pointed to a big gap between Apple’s share price and its earnings. By common methods of valuation that compare a stock price to earnings and earnings growth, the stock should be worth much more.

The average target price of Apple shares given by 37 analysts who have updated their ratings since the Jan. 24 report is $588, according to FactSet data.

Analysts say the company’s policy of keeping its cash rather than paying a dividend has been hurting the stock. Value-oriented funds are often forbidden from investing in companies that don’t pay a dividend, and growth-focused funds are often tapped out – they’re heavily invested in Apple already, and likely don’t want to increase their holdings.

However, company watchers expect Apple to start paying a dividend this year. On a conference call after the earnings report, chief financial officer Peter Oppenheimer said the board was in “active” discussions about the company’s use of cash.

Apple looks set to launch sequels in its hit iPhone and iPad franchises this year. There’s also speculation that it will move into the TV market.

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The Justice Department ended a six-month review of the deal after concluding it won’t stifle competition in the mobile device market. European regulators reached the same conclusion.

The regulatory green lights mean Google Inc. can take control of Motorola Mobility Holdings Inc. if it can win government approvals in China, Taiwan and Israel.

China looms as the biggest stumbling block, given Google’s shaky relationship with the government there.

Google Inc. prizes Motorola’s more than 17,000 patents—a crucial weapon in an intellectual arms race with Apple, Microsoft and other rivals to gain more control over smartphones, tablets and other mobile devices.

Motorola’s patents would help shield Google’s Android operating system from lawsuits alleging intellectual theft.

The clearances announced Monday removes key hurdles to Google completing the biggest deal in its 13-year history.

Google said it hopes to complete the Motorola acquisition early this year. The deal was announced six months ago.

In granting its approval, the European Union raised concerns about Motorola’s aggressive enforcement of its patents.

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The preliminary harvest report was released Friday by the U.S. Department of Agriculture.

It showed that reduced supply meant increased prices.

Napa County recorded the highest prices for grapes with an average $3,400 per ton—up 5 percent from the previous year. Grapes from Sonoma and Marin counties netted an average $2,081 a ton—up 3 percent.

Factoring in all wine grape-growing regions, the average price for red wine grapes went up 12 percent to $702 a ton. For white, it went up 8 percent to $541.

When table grapes are included, the overall tonnage of the California fruit was still down 3 percent.

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According to the report, there were concerns about Jobs’ past drug use and his lack of support for his eldest child, who was born out of wedlock. Jobs died in October after a long fight with pancreatic cancer.

You can read the report here. We’ve pulled a few paragraphs of the information, which you can read below.

Reading through the early pages, we know that Jobs wasn’t a communist or wasn’t connected to any group that wanted to overthrow the government. They really asked him that. According to the Council’s Web site, the group is the “principal national advisory committee on international trade.”

Related Resources:
California Attorney General’s Settlement Information
Frequently Asked Questions On Who Qualifies
San Francisco Consumer Credit Counseling Service
HUD Approved Hosing Counseling Agencies

The lenders will have three years to fulfill the terms of the landmark deal that California Attorney General Kamala Harris said could make as much as $18 billion of relief available to thousands of homeowners in the state.

KCBS’ Holly Quan Reports:

Harris and New York Attorney General Eric Schneiderman had been reluctant to sign onto the settlement that did not offer significant help for homeowners.

California walked away from settlement negotiations in September when homeowner relief for California was expected to be $4 billion. Harris said in a written statement the new settlement guarantees as much as $12 billion in principal reductions for California homeowners who are underwater on their loans or behind on payments.

Harris said the additional money allocated for California would help some 28,000 homeowners in the state eligible for refinancing, and another 140,000 eligible for cash restitution because the banks seized their homes.

KCBS Cover Story: Underwater Homeowners Credit Community Activism for Mortgage Relief

“This is not the complete conclusion to the foreclosure crisis. It’s not going to reach everybody, but it’s a meaningful start,” said Bruce Mirken with the San Francisco-based Greenlining Institute.

Mirken applauded Harris’ push for the larger settlement, which could ultimately be worth $40 billion nationwide.

“It’s certainly more than folks feared that this deal was going to have,” he said.

KCBS’ Doug Sovern Reports: Challenges Inherent With Navigating Mortgage Settlement

The settlement also allows Harris to sue banks who are slow in complying with its terms.

The deal ends a separate investigation into Bank of America and Countrywide for inflating appraisals of loans from 2003 through most of 2009. Bank of America will pay $1 billion to settle that federal probe.

Oklahoma is the lone holdout and will receive no money.

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The results announced Thursday indicate LinkedIn Corp. is playing an increasingly influential role in the employment market as millions more people post their resumes there. The professional-networking service has been turning into a digital rolodex for headhunters and job seekers alike.

LinkedIn added another 14 million profiles during the final three months of last year to bring its total membership to 145 million. Meanwhile, more companies have been paying to get additional access to LinkedIn’s membership as the U.S. economy has been steadily adding jobs in recent months.

LinkedIn gets more than two-thirds of its revenue from fees it charges companies, recruiting services and other people who want broader access to the profiles and other data on the company’s website. The rest comes from advertising.

The trends helped LinkedIn fare far better than the company’s own management and analysts had predicted. The pleasant surprise came a day after online coupon distributor Groupon Inc. raised investor doubts about young, rapidly growing Internet companies by announcing an unexpected fourth-quarter loss.

LinkedIn’s numbers seemed to lift spirits; the company’s stock surged more than 8 percent late Thursday.

The ebullient reaction may bode well for an upcoming IPO from Facebook Inc., which has built an online network of 845 million users by focusing on family and friendships instead of career advancement. Facebook filed papers last week for an initial public offering of stock. It’s expected to be completed in May or June. The IPO is expected to value Facebook at $75 billion to $100 billion.

LinkedIn, which is based in Mountain View, has emerged as one of the stars from last year’s crop of Internet IPOs. During the first nine months of trading, its stock has remained well above its IPO price of $45 and is moving upward again. The stock rose $6.44, or 8.4 percent, to $82.83 in extended trading Thursday after the release of results.

LinkedIn earned $6.9 million, or 6 cents per share, during the final three months of last year. In 2010, the company had income of $1.6 million, or 3 cents per share. It’s not directly comparable because LinkedIn’s outstanding shares have ballooned since its IPO in May. Before figuring the net income credited to shareholders, LinkedIn’s net income for the latest quarter increased 30 percent from $5.3 million

If not for certain accounting items unrelated to its ongoing business, LinkedIn said it would have earned 12 cents in the fourth quarter. That figure topped the average estimate of 7 cents per share among analysts polled by FactSet.

Revenue more than doubled from the previous year to nearly $168 million – about $8 million above analyst estimates.

Management’s projections for the first quarter and full year also called for revenue above analyst forecasts.

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The planned purchase of Taleo extends Oracle’s offerings in the growing arena of cloud-based computing. With such an approach, businesses don’t run software and services in-house, but rather send those tasks to remote locations operated by companies such as Oracle and IBM Corp.

Taleo, based in California, makes human-resources software that runs on the cloud.

Oracle is paying $46 a share for Taleo stock. That is 18 percent above Wednesday’s closing price of $38.94.

Taleo’s stock rose 18 percent to $45.85 in pre-marking trading.

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“We want to know that the next time we come into Apple to buy a fancy new tech gadget that it was made not by workers who were suffering from these horrific work place abuses in factories like Foxconn,” said Charlotte Hill with Change.org, the organization behind the petition drive.

KCBS’ Margie Shafer Reports:

Hill and other activists delivered what they said were 250,000 signatures the old fashioned way to the Apple store in Union Square. Manager Larry Verter cordially accepted the stack of signatures and said he would forward them to his corporate office.

The petitions were launched in January after a series of reports in the New York Times documented harsh workplace conditions at several Apple factories in China.

“They’re working with these really cheap chemicals that are causing really severe neurological damage. We say no iPhone is worth that cost,” Hill said.

In a written statement, Apple defended measures taken to ensure the workers in its supply chain were treated fairly. The company said it audited 229 supplier facilities in 2011, and posted the results of those audits on its website.

“We insist that our suppliers provide safe working conditions, treat workers with dignity and respect, and use environmentally responsible manufacturing processes wherever Apple products are made,” the statement reads.

It also notes that Apple was the first technology company admitted to the Fair Labor Association, a leading non-profit dedicated to improving conditions for workers around the world. Apple said an independent FLA audit of its suppliers would soon be published online.

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Cisneros said the request for proposals would require banks to detail how many mortgages they re-wrote and how many homeowners went into foreclosure.

“We want to ensure that this procurement and this RFP reflect the values and the goals of the city and county of San Francisco,” he said.

KCBS’ Barbara Taylor Reports:

“We want to ensure that this procurement and this RFP reflect the values and the goals of the city and county of San Francisco,” he said.

The city currently has 130 checking accounts at Wells Fargo, Bank of America and Union Bank that see a combined $12 billion in activity every year.

Some have suggested the city bypass commercial banks entirely and form its own municipal bank because those banks have foreclosed on San Francisco homeowners.

Instead Cisneros’ proposal calls for guarantees of social responsibility. The treasurer said banks would have to explain how they serve the community and invest in it.

A Board of Supervisors committee approved a resolution incorporating those goals on Wednesday, and sent it to the full board for final approval.

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The proposal by Supervisor Scott Wiener would alter the city’s planning code, which prohibits food trucks on such campuses if they are outside of commercial districts.

Under the current law, campuses such as San Francisco State University and Kaiser Permanente Medical Center are not allowed to have food trucks on their property.

KCBS’ Barbara Taylor Reports:

“San Francisco values choice in food options, and this legislation will increase choices,” Wiener said in a statement.

“Allowing institutions to provide their employees, students, or patients with additional food options, including food trucks, is a good thing and should be encouraged. It makes no sense to ban these campuses from doing so,” he said.

Wiener’s office said the supervisor also plans to introduce more comprehensive food truck legislation in the future and has convened a working group of stakeholders, including operators of both food trucks and brick-and-mortar businesses, commercial property owners and city department officials.

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It’s a program that is already going gangbusters in Seattle. Russia-born Svetlana Anikeeva is helping fund a development boom in Seattle with an investment of $500,000. For that, she expects a modest return on her money, and something far more valuable; a permanent green card.

It’s called an EB-5 visa. EB stands for Employment Based. Anikeeva invests half a million dollars in a project that creates 10 American jobs, proves her money is clean, and sees the project through to completion.

Or, as Anikeeva explained, “It’s pretty much like a marriage visa. Once you’ve proven it’s for love, they give you permanent residence.”

It’s expensive, but it’s also one of the fastest routes to permanent legal residency.

“If you have the money, you do this,” explained Henry Liebman, an immigration attorney turned real estate developer. Everything he builds is financed with foreign money.

Most investors are Chinese families, many of whom want to send a child to school in the United States. Others include Europeans who would like to retire in a place like Florida.

Just four years ago, fewer than 300 Chinese investors applied for EB-5 visas. Now, that number is approaching 3,000 a year. At 20 years old, the program is just now taking off largely because of the economy.

“Until the bust, it really wasn’t popular at all, then it became one of the few sources of financing,” said Liebman, who is likely the largest EB-5 developer in the country. With more than 1,500 investors, at $500,000 a piece, he has a lot of financing.

The investments are enough to singlehandedly reshape the Seattle area known as SoDo, or “South of Downtown.” His vision is based largely on what has happened in San Francisco’s South of Market neighborhood. Walk by Safeco Field, Seattle’s baseball stadium, and there are several blocks of construction. It’s the result of a massive influx of foreign investment.

Seattle’s EB-5 construction boom doesn’t end with private buildings. The massive upgrade of State Route 520, also known as The Floating Bridge, includes a healthy dose of foreign investment. The highway project is literally a path to American citizenship for 95 families.

The use of foreign money was the brainchild of developer Mike Mattox. He calls the EB-5 program “one of the best tools The United States has for creating jobs and bringing money into this country.” He describes it as “a win-win for everybody.”

In the Bay Area, dozens of new EB-5 investment centers are popping up. Foreigners can put money in Wine Country, Silicon Valley, and maybe even professional baseball. Oakland Mayor Jean Quan wants to keep the A’s from moving by building a new stadium with EB-5 dollars.

There are some catches. If a project goes bust, applicants lose their money, along with their path to that permanent visa. Also, developers are not allowed to solicit investors. The investors have to track down developers like Liebman. That usually happens with help from the Internet and investment advisors abroad.

The EB-5 program is now bringing more than $1 billion into the United States every year. Not only is the economy driving up the number of EB-5 applications, President Barack Obama wants to expand the program. His administration is looking for ways to get as many as 10,000 issued per year.

Back in Seattle, Anikeeva watches her investment grow, as her family settles down for life in America. She has just one wish for the seven-story office building she helped fund across the street from Safeco Field: a brewery.

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Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Financial agreed to the settlement—for an estimated $37 billion as of Wednesday for lowering homeowners’ mortgage principal, refinancing, a reserve account, and checks to homeowners. However, they were seeking releases from further legal liability, which have been one subject of negotiations for the past several days with state attorneys general who wanted to pursue investigations.

Phil Matier: State AG Decides To Negotiate On Foreclosure Settlement

The settlement grants immunity from civil lawsuits brought by the attorneys general against the lenders over narrowly defined “robo-signing” cases.

The source, who was not authorized to disclose the agreement before an announcement expected Thursday or Friday, said other holdout states—Delaware, Massachusetts and Nevada—all have or are imminently expected to also agree.

The source said the agreement will enable authorities to pursue all claims over mortgage-backed securities that collapsed. It lets them use facts from robo-signing claims in securities, insurance and tax fraud cases.

It also preserves the lawsuit filed last week by New York Attorney General Eric Schneiderman that accused some banks of deceit and fraud in using an electronic mortgage registry that allegedly put homeowners at a disadvantage in foreclosures.

Schneiderman’s office declined to comment Wednesday night. New York has some 118,000 “underwater” borrowers whose homes are worth less than their mortgages and would expect to get $136 million as a guaranteed cash payment from the settlement.

California, with more than 2 million underwater borrowers, would get $430 million. Florida would get $350 million and Texas $141 million.

Most states had already backed the nationwide settlement stemming from abuses that occurred after the housing bubble burst. Many companies that process foreclosures failed to verify documents. Some employees signed papers they hadn’t read or used fake signatures to speed foreclosures—an action known as robo-signing.

The deal would be the biggest involving a single industry since a 1998 multistate tobacco deal. It would force the five largest mortgage lenders to reduce loans for about 1 million households. The reduced loans would benefit homeowners who are behind on their payments and owe more than their homes are worth.

The deal includes $2.7 billion in guaranteed cash payments altogether, and estimates of $1.5 billion for payments to victims of wrongful foreclosure, $3 billion from a refinance program and $32.3 billion in homeowner benefits from loan modifications.

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The parts themselves come from more than 150 companies from various parts of the world. The majority of those antennas, glass, metal, sensors and silicon are manufactured overseas.

How Cupertino-based Apple Inc. finds parts and manufactures its products, almost entirely abroad, is standard protocol in the technology industry. Electronics companies say Asian manufacturing plants are more affordable and more versatile than those found anywhere else in the world.

But as the most valuable tech company in the world, Apple is seen by many as a role model in business. And its reliance on cheap overseas labor — most notably at factories in China run by manufacturer Foxconn — has come under increased scrutiny in recent media coverage by CNN, The New York Times and other outlets.

Foxconn, owned by Hon Hai Precision Industry, counts Apple among its business clients, which also include Amazon.com, Hewlett-Packard, Microsoft and many other tech giants. Apple has reported violations at its facilities, and Foxconn has come under fire for a slew of worker suicides in 2010 and conditions that workers-rights groups say are inhumane.

Workers at Foxconn and other plants in Asia must stay busy to keep up with the world’s seemingly insatiable demand for Apple products.

During the last three months of 2011, Apple sold 37 million iPhones, 15.4 million iPads, 15.4 million iPods and 5.2 million Mac computers, according to the company’s financial report. That netted Apple $46.3 billion in revenue and $13.1 billion in profit, which is double what Apple made during the same period a year before.

Where does all that profit come from?

Take the iPhone, for example. The iPhone 4S sells for $199 if the customer signs a two-year cellular contract. But AT&T, Sprint Nextel and Verizon Wireless pay Apple much more for the phones in order to sell them at a lower price, a process called subsidizing. To get a so-called “unlocked” or contract-free iPhone, expect to pay at least $649 to Apple.

The costs of parts and manufacturing for Apple’s iPhone 4S is estimated to be $196, according to industry research firm IHS iSuppli. That’s $453 less than Apple charges for a contract-free phone. Marketing and research can add up, but no matter which way you cut it, Apple is making a sizable profit on each phone it sells, said iSuppli analyst Tom Dinges.

Apple has more than 60,000 employees, most of whom work in its retail stores. To build parts and assemble products, Apple has a long list of partners. That’s partly done to avoid being dependent on any one manufacturer and to get favorable deals on each part from the many competing companies.

Still, Apple tries to minimize the number of companies with which it signs deals, Dinges said. That way, Apple wields more influence because it’s among the biggest-spending clients, he said.

“They’d rather be a mile deep in a supplier than divide the business up amongst five,” Dinges said. “You’re going to take care of your biggest customers first.”

In its supplier report, Apple says 156 companies account for 97% of the money spent on materials, manufacturing and assembly for its coveted gadgets. When the client is a powerhouse like Apple, winning a contract to be one of those 156 is a major event. In Wall Street parlance, it moves stock.

Being anointed by Apple boosts a supplier’s credibility, but Apple is a shrewd negotiator, from how it develops an iPad to how it leases or builds the retail store it’s sold in. This reportedly forces Apple’s partners to push workers and cut corners in order to wring profits.

Apple told CNN in a statement that its expectations for suppliers to operate responsibly increase each year. Apple says it conducted 229 audits of suppliers last year and reported its findings publicly online.

“We care about every worker in our worldwide supply chain,” Apple said in the statement. “We insist that our suppliers provide safe working conditions, treat workers with dignity and respect, and use environmentally responsible manufacturing processes wherever Apple products are made. Our suppliers must live up to these requirements if they want to keep doing business with Apple.”

(Copyright 2012 CBS San Francisco and CNN. All rights reserved.)

Facebook added 45 million users at the end of 2011, but that was its smallest increase since the spring of 2009. Even in Asia, fourth quarter user growth was its weakest in over a year and a half according to its IPO finding. KCBS Technology Analyst Larry Magid said that Facebook is likely slowing overseas because many countries have their own local social networks that are more popular than Facebook.

”For example, I’m in Russia right now where there’s a service that’s popular among Russians because they do a better job with the Russian language, and it’s focused on the Russian experience, so I’ve talked to people who say they prefer it to Facebook,” said Magid.

KCBS’ Matt Bigler Reports:

Analysts are also looking for signs of Facebook fatigue as the company prepares to go public. However, a new study by the Pew Internet and American Life Project found no evidence of that among long-time users. In fact, the company said that more regular Facebook users are logging in every day.

Related:
Puffed-Up User Numbers May Mean Facebook Is Overvalued

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

The 2012 Silicon Valley Index shows a major crisis brewing in the public sector, asserting that the present tax system is outmoded.

“Our tax system is pegged to an earlier kind of economy,” said Russell Hancock, CEO of Joint Venture Silicon Valley. “It’s heavy on property tax and sales tax and it doesn’t capture internet transactions or the services.”

KCBS’ Mike Colgan Reports:

Emmet Carson, CEO of the Silicon Valley Community Foundation, said that Prop. 13, which was enacted in 1978 and limited property taxes to one percent of assessed value, no longer works today.

“Because of the great recession, our current method for how we assess property values and raise tax revenue to support public services is broken,” said Carson.

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

The San Francisco-based payments processor posted a notable 10 percent increase in U.S. credit card use.

But debit card use rose just 6 percent. That’s the slowest debit card growth rate in more than a year, and comes during the first three-month period that new rules were in place to limit the fees retailers pay to accept the cards.

The rules also require that starting in April, merchants get a choice on which network handles their debit transactions. In the last few months, Visa has been offering incentives to encourage stores to choose its network.

Debit growth has been slowing over the past few quarters.

“It didn’t come totally out of the blue,” said Edward Jones analyst Shannon Stemm. While it’s still early to determine the impact of the new regulations, she noted that rival MasterCard Inc.’s results last week showed some apparent debit market share gains versus Visa, which still holds the bulk of the U.S. debit market.

Nevertheless, Visa’s results for the quarter showed strong growth indicating consumers continue to shift away from cash and toward plastic and electronic payments.

Visa posted net income for the three months ended Dec. 31 of $1.03 billion, or $1.49 per share. That compares with $884 million, or $1.23 per share, in the year-earlier period. There were 4 percent fewer outstanding shares in the recent quarter due to buybacks, which increases per-share results.

Revenue for the quarter rose 14 percent to $2.55 billion, from $2.24 billion the prior year.

Analysts, on average, were expecting profit of $1.45 per share, on revenue of $2.47 billion.

Visa, the world’s largest payment network, said the gains reflected higher card use, increased data processing revenue and a 19 percent boost in international transactions. It is aiming to increase its business overseas so that it eventually generates more than half of its revenue. For the quarter, international transaction revenue accounted for about 29 percent of total revenue.

The company also said its board approved another $500 million share buyback program.

Visa now expects annual revenue growth in the low double digits, which removes the lower end of its prior forecast for high-single digit to low-double digit growth. It forecast earnings per share growth in the high teens, updating its prior projection for a high single-to low-double digit range.

The results buoyed the stock. In aftermarket electronic trading, Visa shares added $3.65 to $112. The stock closed the regular session up $1.37 at $108.35.

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

Cisco Systems Inc. has emerged leaner after a round of layoffs and a narrowing of its focus.

Net income was $2.2 billion, or 40 cents per share, in the fiscal second quarter, which ended Jan. 28. That compares with earnings of $1.5 billion, or 27 cents per share, a year ago.

Excluding the cost of stock-based compensation and some acquisition-related amortization, Cisco earned 47 cents per share. Analysts polled by FactSet had expected earnings of 43 cents per share on that basis.

Revenue was $11.5 billion, up 11 percent from $10.4 billion a year ago. Analysts expected $11.2 billion.

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

Starting this October, the legislation will institute a 10-cent fee for each bag provided by any retail establishment to customers. Restaurants will also be required to charge the fee starting in October 2013.

The city’s 2007 ban on supermarkets and chain store pharmacies providing single-use, non-compostable plastic bags will expand to include all retail stores in October, then restaurants the following year.

KCBS’ Barbara Taylor Reports:

The businesses charging the fee will keep the money to use how they see fit, and the plastic bag ban will include certain exemptions, such as “doggy bags” used to take home leftover food from restaurants.

Before supervisors voted on the ordinance, board president David Chiu introduced an amendment to provide additional exemptions that will allow the use of plastic bags for various delicate or heavy items, and another to require further outreach by the city’s Department of the Environment.

“All of us have heard that we still have to do more” to educate residents and merchants about the new law, Chiu said.

Department of the Environment director Melanie Nutter said her department had reached 23 different neighborhood and merchant groups to talk about the legislation and has outreach workers that speak several different languages.

Nutter said the department has also set aside money and is working with corporate partners to provide a reusable bag giveaway in the city.

“We’re poised and ready as a department … for the next seven months” when the law will go into effect, she said.

Supervisor Carmen Chu said she is aware that there are many people who see San Francisco as a city that “nickels and dimes every single thing” and that a lack of outreach could create “a lot of confusion and bad feelings.”

The vote on the proposal had been delayed for two months while more outreach was done.

During that time, the legislation’s author, then-Supervisor Ross Mirkarimi—who also authored the 2007 law—was sworn in as the city’s new sheriff and Christina Olague was appointed as his replacement.

Olague took over as a sponsor of the ordinance and expressed support of it before the vote.

“The only effective way to change the behavior of most customers is to institute a charge,” she said, adding that the law will cut down on both private and public costs of disposing of bags and is “a crucial next step” toward the city’s zero waste goal by 2020.

The board voted 10-0 in favor of the proposal. Supervisor David Campos missed Tuesday’s meeting due to an illness.

The ordinance will return in front of the board next week for final approval and then go to the mayor’s desk for signature.

(Copyright 2012 by CBS San Francisco and Bay City News Service. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)