Do we need BindingSource with Entity Framework 4.0?

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Do we really need BindingSource to bind to controls? I.e. what problems does it solve?

Do you use the BindingSource, or do you use an alternative method?

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Yes, you need it regardless of your underlying data source. The primary raison-d'être of BindingSource is to avoid memory leaks that can occur when subscribing directly to change notification events on data objects. As long as you're using the default Windows Forms binding mechanism, you'll need BindingSource.