In summer 2002, Summerhouse released Best Of Friends, the long-awaited compilation which features tracks from almost all the band's singles and albums. The album also features extensive notes from founder William Jones and an introduction from former Factory artist and friend of the band Graham Fitkin.

Jones had made a couple of solo recordings during Friends downtime, and one of these, Downstream, featured on a CD single, Special You, preceding the imminent new studio album. Downstream, originally written as incidental music for a production of Shakespeare's Twelfth Night, was recorded in day at Fairview in early 2001, and a solo version of the early song Every Summer was also included. One night in early 2002 William Jones recorded an eight-song mini-album of songs for acoustic guitar and voice in a London studio, and these too may appear on future Friends albums either as they stand, or arranged into songs for the full band.

Beautiful You appeared in September 2002 to a good response from new and old fans, the odd good review, and to much wider distribution due to Summerhouse's new deal with Native/Pinnacle. The album was a return to the classic Friends pop style, but with some interesting and unusual features such as the Latin/flute-tinged So You Say, the lengthy funky bass workout on The Avenues, and the elegiac strangeness of It Passed Me By – with, inevitably for Friends, the blissful summerama of When The Sun Shines and the buoyant optimism of This Is The Start.

"It was wonderful to get back in the studio again. After all the time away I felt that we'd ended up with an excellent choice of songs, and for me it's our best album, and the most satisfying to make. The only frustration was having so many songs that we couldn't record, but we've kept them for another time. The lay-off wasn't quite of Steely Dan proportions, and we never quit, just went very quiet, and I now feel we've never been away."

Now back in the groove of writing and recording, Late Night Early Morning was recorded a year later and released in June 2004. With regular singer Katherine Dow Blyton unable to get away from acting duties as a regular on Hollyoaks, Melanie Harrold stepped in and added some very individual harmonies and wordless improvisation to bring a new dimension to several of the songs. A location recording of a swimming pool in Hull, mixed into the album's closing song Slow Dissolve, added to the weirdness.

In 2007, after a break of 13 years, Friends finally returned to live performance, with a warm-up gig at the Wilmington in Rosebery Avenue, London, and two shows at the Spitz, one of them a special Summerhouse night to launch new signing Showstar, and also featuring 4,000,000 Telephones and ex-Rumblefish singer Jeremy Paige. An acoustic version of the band, available and ready to play at any time, also played a couple of gigs with a voice/guitar/double bass/percussion line-up.

A new recording of the classic You'll Never See That Summertime Again, the longer, more ambitious Spangleland, and a compilation of all six of the band's singles, Single Friends, bring things up to date as at early 2009.

"It's been an amazing journey, when you look back to 1986 and see how we've turned out. And it isn't over yet, not by a long way! To quote one of my favourite songs, you could even say that this is the start."