Software as a Service (SaaS) is simply good economic sense.  There’s little reason to build, maintain, and back up applications when it’s getting cheaper and easier than ever simply to host the applications online.

Peter Coffee, director at cloud computing firm Salesforce says that the SaaS “shifts scarce, in-house IT talent away from the time-consuming but low-value tasks of acquiring, maintaining and administering commodity technology to let those resources be applied to high-value tasks creating competitive advantages for the business,”

The old business model of selling licenses for software is going to go the way of the horse and buggy.  Rather than buying software, companies simply subscribe to the application as a service.  There are no worries about keeping the programs up to date because that is all taken care of by the SaaS provider.

Billing models for SaaS vary.  Right now, most are still based on time interval usage.  For example, month-to-month recurring billing is most common.  But, as time goes on, expect SaaS billing to offer even more flexible billing models with pay per use and metered usage becoming more popular.

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According to consulting firm, the TowerGroup, nearly $5 billion of money on gift cards will go unspent.  This is known as breakage.

An example of breakage is the $10 left unspent on a card if you spend $40 out of the $50 on on the card.  Breakage also occurs if a card is lost or misplaced, frequently resulting the entire amount funded on the card being abandoned.

Retailers love breakage because unspent money is pure profit.  For instance, electronic retailer BestBuy reported that $38 million of its gift cards were not redeemed last year.

Gift cards continue to be the gift of choice for many.  Over $97 billion was spent on cards.  The average gift card is funded for $140.  Over 70% of shoppers using gift cards spend more than the amount of the card.  And almost 7% of cards went unspent last year.

The Federal Reserve has proposed new guidelines that would prohibit fees for cards that have been inactive for less than a year and outlaw expiration card value within 5 years.  But, that doesn’t do much to impact the breakage issue.

If you get an unwanted gift card for a store you don’t patronize this year, there are several websites that allow you to swap out the card for a small fee.  You may also want to donate the unwanted card to a charity.

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