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Third party backup utilities offer more features, such as scheduled backups and self-executing restore files. What the restore files allow you to do is restore without ActiveSync or any connection to the PC. Just tap on the file to execute it, and it restores everything for you in a few minutes. Great when you are away travelling, or just away from a PC.
Although WM5 has persistent storage, that doesn't mean you will never have an unexpected hard reset from software conflicts. If you want to avoid losing data/reinstalling programs, you still need a backup.
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