The popular video game maker, Electronic Arts (EA), has confirmed rumors that it would acquire the online game maker Playfish for a reported amount of up to $400 million.

Right now, EA is set to pay $275 million in cash for the company, in addition to $25 million in equity. EA has added performance covenants through December 31, 2011, were assuming Playfish continues to grow, EA will pay up to $400 million for the company.

The acquisition will help propel EA into the online social gaming realm.

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Z-Commerce (developed by Zuora) is a new service launched at DEMO 2009 that lets Facebook app developers by-pass the existing Facebook app monetization model that only includes ad revenue, to making the apps exclusively subscription-based with a fee by using Z-Commerce that leverages the Facebook API.

In a blog post Zuora blog post, Tien Tzuo, writes:

At Zuora, we imagine a world where every Facebook user pays some developer one dollar, per month, for some application that they found valuable. That’s 2 billion dollars a year that Facebook developers could be making.

The problem is, very few (and I stress, very few) people would actually be willing to pay for an app on Facebook, in fact, most apps are, well, useless. It is estimated less than about only 1% of Facebook developers actually make a decent return from the 50,000 existing apps on Facebook.

Nevertheless, this could be an option if someone thinks his or her app will be the next big thing. As Facebook continues to struggle to generate cash, I would expect it to offer different monetization methods for developers, which could pose a significant risk to VC backed Z-Commerce, where Facebook could even ban the service.

Handheld computer maker Palm has announced a $100 million investment from its largest equity provider Elevation Partners who owns at least 25% of the company. The funds will be used to expand Palm’s new upcoming operating system and operations. Palm is expected to unveil its new mobile OS at the Consumer Electronics Show (CES) which runs near the end of Jan 2009. Palm continues to struggle with sales as competition stiffens from Blackberry and the iPhone. Palm will also unveil its own App Store, Read the full story

Facebook has just launched a birthday reminder service which essentially notifies you if any of your friends have a birthday in the upcoming week. This service may seem trivial, but it will probably kill all the other apps that do the same thing on Facebook. For example, Birthday Alert has over 180,000 active users. Facebook will monetize this service by allowing you to purchase e-gifts for your friends. Birthday alert services can actually be very profitable. Consider this, Bebo was initially founded to provide just this service and it has quickly grown to a large social network and now that very birthday alert service generates over $4 million in annual revenue for Bebo from e-gift purchases. According to Compete, Bebo gets about 3 million unique visitors per month. I personally find it very interesting that people would actually pay to send an electronic gift, especially those simple icons Facebook offers, and an e-card, that’s more reasonable, but I’m still surprised. Via