The Next Web has more information about what has changed specifically:
The new interface for setting up those alerts has been tweaked to let you set the exact distance threshold from a location. This lets you fine-tune the sensitivity of an alert for, say, two different buildings on a campus. If you just wanted to know when someone is ‘home’, the older process with a ‘fixed’ zone was fine, but if you were looking to get notices when someone gets into a neighborhood, it was pretty much impossible.
Find My Friends is a free download from the App Store. [Direct Link]