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From a webmaster standpoint, yes, they are used very much. There are even sites popping up that feature sponsors with RSS feeds to make them easier to find for those webmasters looking for them.
From a surfer standpoint, I don't know of the numbers but I am sure there are many people subscribing to various RSS feeds. I think Fire Fox even has a RSS reader. I doubt they would have went to the trouble if there was no demand. Nor would you see those little Orange RSS buttons everywhere.
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