Factory data reset - what does it really do?

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Dec 9, 2009
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Michigan USA
Hello All
The other day i decide to do a "factory data reset" on my phone. My phone for a very long time for certain programs like "Messaging" has been "Force Closing", plus phone been lagging like crazy. So, what does "factory data reset" really do? Looks like it just erases everything. It doesn't do a full reformat like a computer. So what benefit is it?
 
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