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To me, circles are better than Facebook's lists because a) they're far easier to manage and b) Facebook's model is "everyone you know can see this except..." while Google's is "only these people you've specified can see this." It's slightly splitting hairs, but it's made a big difference in how I feel about who can see what and what I'm willing to share.
And hangout is awesome.
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'He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me.'
-TJ
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