Just about every Exchange Server FAQ or best practices list advises admins to turn off circular logging—and for good reason. Circular logging prevents up-to-the-minute database recovery in favor of saving disk space. Given that disk space is relatively inexpensive, trading recoverability for disk space is usually a bad decision.
But there are exceptions to this rule. Servers that home public folders for Internet newsgroups can benefit from circular logging. If damage occurs to an information store that contains newsgroups, the information can be brought up to date easily by rebuilding the database and updating the newsgroups from the Internet. Because it's easy to fully recover newsgroup information without transaction logs, circular logging makes sense in this situation.
Prior to Exchange 2000, you needed a dedicated public folder server for newsgroups if you wanted to enable circular logging for your Internet public folders. Otherwise, the recoverability of the rest of your Exchange information was compromised.
Exchange 2000 storage groups remove the need for building a separate server because each storage group now has its own logging policy. So you can use one server with two storage groups: one storage group without circular logging to home your users' mailboxes and one storage group with circular logging to hold Internet newsgroup folders.
As with storage groups and circular logging, new features sometimes make old features more useful.