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I couldn't say if jQuery UI is better or this is better, honestly seems they are just different. Even if Kendo UI is faster I have never had a speed issue with jQuery UI (not speaking for everyone, just, I personally have never had a speed issue).

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The UI Widgets seem quite nice and well-designed: http://demos.kendoui.com/combobox/remotedatasource.html

This is closer to ExtJS and Sencha than JQ UI.

jQuery UI is pretty sluggish under some of the iOS build-app-in-JS frameworks (e.g., PhoneGap) and for webapps because those don't use the new nitro engine (I understand that's coming in iOS 5). It's not nearly as bad under standalone Safari with a mobile web page. If someone wanted to test their performance claims, that might be a good thing to try.

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