The following features are new in ADO.NET version 2.0:

Managed Providers

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Server Enumeration

Provides support for enumerating active instances of Microsoft SQL Server 2000 and later.
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Asynchronous Processing

Allows you to perform asynchronous database operations using an API that is modeled after the asynchronous model used by the .NET Framework.
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Multiple Active Result Sets (MARS)

Allows an application to have more than one SqlDataReader open on a connection when each instance of SQLDataReader is started from a separate command.
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Bulk Copy Operations

Enables you to perform fast bulk inserts using the .NET Data Provider for SQL Server.
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New SQL Server Max Data Types

Provides support for varchar(max), nvarchar(max), varbinary(max), and xml data types in SQL Server 2005.
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SQL Server User-defined Types

Provides support for user-defined data types (UDTs) in SQL Server 2005.
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SQL Server Notifications

Allows .NET Framework applications to send a command to SQL Server and request that a notification be generated if executing the same command would produce result sets different from those initially retrieved.
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Transactions with SQL Server Snapshot Isolation

Provides support for snapshot isolation, a SQL Server 2005 mechanism designed to reduce blocking in OLTP applications.
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Database Mirroring in SQL Server 2005

Provides support for database mirroring in SQL Server 2005 with new connection string syntax for specifying a failover partner server.
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SQLXML 3.0 in SQL Server 2005

SQL Server 2005 exposes the functionality of SQLXML 3.0 inside the Microsoft .NET Framework. Developers can write applications that access XML data from an instance of Microsoft SQL Server and process the data in the .NET Framework environment, sending updates back to SQL Server.
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Provider Statistics

Provides support for retrieving runtime statistics in SQL Server 2005. Currently 21 different counters are available from the .NET Provider for SQL Server.
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Change password in SQL Server 2005

Allows .NET Framework applications to change password of a user account without requiring administrator intervention.

Disconnected Classes

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Batch Processing

Enhances application performance by reducing the number of round-trips to the database when applying updates from the DataSet.
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DataSet Enhancements

The new DataTableReader presents the contents of a DataSet or a DataTable in the form of one or more read-only, forward-only resultsets.

Provider Independent APIs

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.NET Data Provider Enumeration

Provides support for enumerating installed data providers.
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Provides support for enumerating installed data providers

Enhancements to the Common Model provide access through a single API to databases across multiple providers.
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Schema Discovery

The schema discovery API allows applications to request managed providers to find and return information about the database schema of the database a given connection is connected to. Different database schema elements such as tables, columns and stored-procedures are exposed through this API.

Enhancements for ADO.NET 2.0

From:MIcrosoft