Is SQL Server Compact discontinued from Visual Studio 2013?

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Yes, SQL Server Compact has been deprecated (see the comments on this Connect item). You should be using SQL Server Express or SQL LocalDB. Some posts:

http://blogs.msdn.com/b/sqlexpress/archive/2011/07/12/introducing-localdb-a-better-sql-express.aspx

http://blogs.msdn.com/b/jerrynixon/archive/2012/02/26/sql-express-v-localdb-v-sql-compact-edition.aspx

http://erikej.blogspot.com/2011/01/comparison-of-sql-server-compact-4-and.html

http://erikej.blogspot.com/2012/07/the-state-and-near-future-of-sql-server.html

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