I have been using CiteULike for quite awhile (after switching from Connotea), but more recently started using Mendeley. Overall, I am really impressed! Mendeley is a relatively new software project (still in beta), and I am surprised by how well it works. It has some crucial features that seperate it from other bookmarking tools such as: ability to sync bookmarks and pdf files back and forth from multiple personal computers and their online server, the ability to organize pdf files locally by title, author, journal, etc., has a citation plugin for Word (so you can stop paying for EndNote), and that the client software is available for Linux! Mendeley has been working so well that I was afraid I might end up abandoning CiteULike, since I most likely won't bookmark something twice.
However, yesterday it was announced that bookmarks from CiteULike can be accessed from within Mendeley. Note that this isn't just the simple ability to import the bookmarks, but that the bookmarks are kept synced and in their own CiteULike folder within Mendeley. Although the syncronization is currently only one way, from CiteULike to Mendeley, further integration of the two tools is suppossedly in the works.
This seems like a great colloboration since CiteULike tends to focus more on the social networking aspect, while Mendeley focuses more on providing a presonal reference manager.
It is nice to see companies colloborating instead of competing.