Batteries and Memory effect

......Yes, it does exist. And, yes, your batteries could possibly have the effects of it.
It's the memory effect. The term "memory" basically is described as the battery "remembers" its usual discharge point and superficially "needs" a charge whenever it hits that point.
In other words, if you have a NiCd that always gets discharged to only 50% of its capacity, it will eventually not run below that 50% mark if you ever wanted to discharge it to a lower point.
Many people who do not know about this effect just throw away the battery because they think it is dead. More than likely, the battery can revived providing that the battery isn't completely damaged (i.e. from years of memory buildup).
The most simple way to get rid of memory is to discharge the battery to 1.0 volts per cell (VPC) on a minimal load, and then charge it fully.
Repeat this procedure until you notice the battery lasting longer and longer on the drain, until it holds its correct capacity and not the "memorized" one. Unfortunately, unless you have good equipment, it is hard to discharge to 1.0 VPC without accidentally "reversing" a cell.
Now, if you were only working on one cell at a time, discharging to 1.0 VPC would be easy, but most batteries nowadays for cellular phones and such are multiple cells in a plastic case. This makes it hard to get every cell to 1.0 VPC.
No batteries are created equal, and what will most likely happen in a multi-cell battery is that one or more of the cells will "reverse" because they are weaker than the other cells.
The reversed cell begins to accept a "backwards" charge from the other better charged cells around it. This is really bad for a battery if you don't catch it, because chances are it won't charge again while in the pack. If you are going to discharge a pack and you cannot open it to test individual cell voltages, please discharge to approximately 1.2 VPC. This will help prevent reversing cells.
If you do reverse a cell and can access each individual cell, I have found that giving that cell about 4.5 volts (up to 1 A current) in the right direction, it will probably set itself straight. Measure the voltage of the cell after the "shock" charge. If it doesn't improve, try again. If you are still unsuccessful, try a higher voltage.
I've needed 9 volts in some cases to get a cell working again. Once you get the cell at > 1.2 volts, immediately put the pack on charge now so that battery won't have time to reverse again.
Charge the pack fully for 24 hours on a trickle charge to make sure that the reversed cell(s) have recovered fully. Also note that the once-reversed cell will never be the same. It will now always be the first one to reverse in the pack, so you might want to be aware of that when you try to discharge/cycle it in the future.
Remember this: if you treat your battery well from the beginning by never letting it acquire memory, you won't have to worry about these weird procedures. Also, remember that all batteries have an expected life. NiCds have a life of approximately 1000 cycles as long as they are treated very well. So, if your battery is really old and doesn't hold a charge anymore, chances are it's not memory, but a tired battery. Let it retire at a recycling center.

1. Invest in a good charger. Make sure the charger you get has good reviews and is well made.
Chargers with micro-controller chips are usually the best choice.
2. When charging your batteries occasionally discharge them fully before recharging them. This is especially helpful to NiCad batteries. Be careful not to discharge too deeply. (Less than 1v per cell for NiCad and NiMH. E.g., a 3.6v pack to no less than 3v.) Discharging to absolute zero will make your battery useless. It's best if you have a charger with a conditioner that will cycle the battery for you.
3. Be sure to store your batteries properly. Do not leave your batteries in a hot car, or in humid conditions. The best storage conditions are a cool, dry place. The refrigerator is fine if you stick in a packet of silica gel with your batteries in a sealed bag to keep them dry. It is a good idea to charge your NiCad or NiMH batteries fully before use if they have been in storage.

There is no need to avoid rechargeable batteries. They can save you significant amounts of money over time. Don't be scared off by the 'memory effect'. It is easily manageable if it ever occurs.

Memory Effect