Matt Cutts at Google recently posted this useful video explaining what "cloaking" is ... and why it is bad for both the user experience and also for SEO / search engine results. He also explains how cloaking is different from providing distinct content for mobile audiences versus regular visitors.
I'll admit that I've never had enough interest in "gaming" Google to go to the desperate measure of this kind of cloaking... but obviously people are out there and doing it:
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