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Ah, Readability, you little trouble-maker. Readability excels in separating Web content from its surrounding wrapper -- you know the ads and promotional material that pays for all this enjoyment.
As someone who makes at least part of my living from all those ads and wrapper ephemera, I'm conflicted about Readability. Readability, as I use it, makes reading articles on my big screen from my couch much easier. As I've gotten a little older, I find that the smaller text in articles is harder to read from 10 feet away. I use Readability to provide light text on a dark background at a larger font size, making it easier to read through articles on most mornings.
I don't think that Readability removes the ability of a Web site to support itself, because you have to browse the page initially, you'll see ads initially. But it is a gray area, and something we as an industry will continue to wrestle with into the future.
My practice is to find an article, read it in Readability, jump back to the original format of the article, and share that format with my Twitter followers. That way, even though I'm not reading the whole thing in smaller print, I am able to share the original work with followers.
How often used: Almost every morning.
Live without it factor: I could live without it, but I'd prefer not too. You can also use Readability to aggregate articles for later reading, or send to Kindle devices. I don't do this very often.