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> unnecessary incompatibilities like the u" notation for Unicode string literals that was dropped

I mean a hard difference between a string and bytes and strings being utf-8 by default seem to be a necessary (and good) reason?

But unicode strings are the default in Python 3, so they could have kept the 'u' syntax and just let it be a no-op. I think that's what was meant.

Right. And they even changed it, I think in Py3.3 -- but that was very late, when many people already decided not to port.