Microsoft unveils Windows Phone 7.8 update for current hardware

WP Central

Microsoft's Windows Phone 7.8

The question of what Microsoft would do for those current Windows Phone users who have generation 1 and generation 1.5 devices like the HTC Titan or the highly popular Nokia Lumia 900 for Windows Phone 8 has finally been answered.

Windows Phone 8’s main features involve new hardware like multi-core processors, NFC and higher resolution displays. Phones like the Lumia 900 cannot take advantage of these new features but Windows Phone 8 also brings additional changes to the Start screen which current users can take advantage of.

In able to ensure that current customers have the best and latest from Microsoft, the company is officially offering Windows Phone 7.8 as an OS upgrade. Windows Phone 7.8 will still be based on the CE kernel and won’t enable advanced Windows Phone 8 features like app and games that use native programming, but it will give current users the new Start screen and appearance of Windows Phone 8.

The new Start screen in Windows Phone 8 has three new elements, including

  • Variable tile sizes, including user customizable selection between small, medium and so-called “double wide” tiles
  • Removal of the “gutter” aka “the gap” known as the off-centered space to the right of the Start screen. The gutter was a carry-over from the Zune days but now Tiles will be evenly distributed on the Start screen
  • New tile colors – yes, while the 10 + 1 model of Accent colors for Windows Phone carried us for nearly two years, Windows Phone 8 and Windows Phone 7.8 will offer a wider selection of colors

Although not being able to directly upgrade to the new NT kernel of Windows Phone 8 may be a bit of a letdown for current users, the Windows Phone 7.8 upgrade should offer new Windows Phone users nearly the same experience considering their lack of advanced hardware.

Update: Nokia just announced Play To DLNA support, Counters for data information, Nokia Music 3.0 and Camera Extras for all current Lumia phones

Do you think it’s a fair compromise and are you satisfied? Let us know in comments.

WP Central


Reader comments

Microsoft unveils Windows Phone 7.8 update for current hardware



Reskinning the UI, BFD.  We need Wallet sans the Tap to Pay NFC stuff (hell bring even that to the 610!)  We need the in app purchasing capability via Wallet so it will spur existing developers to keep updating 7.8 apps.
I'd like the VOIP capabilities but I suspect they are offloading the call to the other core.
Basically if it doesn't require dual cores, give it to us!

Well I do believe in the keynote they said there's some other things coming in the 7.8 update. But mane I miss understood that part.

So Microsoft announce another product that won't be available for months. But worse, they announce that none of the current products will be compatible with it. The nascent Windows Phone market is already tiny in comparison with iOS and Android. This is just going to stop it in its tracks until October. Who in their right minds will buy a WinPho now?
Does Microsoft have ANY commercial acumen at the top at all?

A common reason for announcing a product before it's ready, in spite of the negative impact to near-term sales, is the long-term impact on market share. MS has, as you point out, sacrificed the near-term sales in older to generate buzz and keep some current customers from moving to iOS or Android when existing contracts expire, by letting them know there's an updated Windows Phone model for them "coming soon."
Whether this is better or worse in the long-run for MS is unclear, but I'm sure they weighed the pros and cons. I suspect they considered this and concluded that at their current market share, they have the luxury of having little to lose. They also seem to have gone out of their way to show that current hardware will get the updates that make sense (the non-hardware oriented updates) with Windows Phone 7.8 and still run future software. This will take some of the bite out of the announcement for Nokia and the other hardware vendors who are counting on their Windows Phone revenue between now and Windows Phone 8 and still have existing inventory to sell.
Lastly, I don't think there's anything shocking in this announcement. We all knew that Windows Phone 8 was coming this fall, so bringing some clarity to the fuzzy future is reasonable and helpful to the consumer side of the marketplace. This may also be the beginning of a steady drumbeat of new information leading up to the release. That's also a standard approach to keep the product in the news for max publicity and market awareness by the time of release.

Comments like yours should not be allowed. It was well thought out, reasoned, good grammar and punctuation, informed, and a pleasure to read. Only comments that appear to be written by someone whose head has been slammed repeatedly by his knee can post here.

Exactly.  I have owned my phone for almost 2 years so I cannot complain as tech/phones change constantly and would hinder the growth of WP's if they had to continue to cater to older, my phone, in general.  I am more than happy to get the new start screen! 
Give me data/memory transfer so when I buy a new phone I can continue my games...that is what I care about most.

Yep. My 900 is only 2 months old, and I am ok with this. It would be nice to have wallet, and VOIP, but I understand that it may have limitations on current hardware.

I will be selling my 900 considering it sounds like we are gonna be left out of some apps....color me disappointed...

umm... Five.. But yeah tech industry.. I don't really care too much though until I start getting messages like "umm.. Dude you need two cores for this" When that times comes color me disappointed but if that time is when my contract is up I won't mind at all :D

For those Nokia Lumia 900 owners, who just have decided to sell your Lumia 900 because of this announcement, I am more than happy to buy the Lumia 900 from you. Let me know, when you are ready to sell.
Of course, one lucky winner.

Yeah, I mean, I figured that the single-core Lumia 900 using an old Snapdragon wasn't going to be able to run a lot of the new stuff... but I'm still disappointed at the reality of it.  Oh well.

You knew when the 900 came out that Windows 8 was coming in the fall. Don't be disappointed when you could have very easily held out a little longer for what's coming. I like the 900's myself but held back so I could take advantage and get the OS upgrade and a new Nokia when they become available.
......and maybe one of those new Surface Tablets as well

I agree.  I understand being bummed out, but it was known wp8 was going to be introduced and there is no way current tech would on par with 'all' of wp8.  Lumia 900 is a sweet phone and the update to 7.8 is great, imo.  Shoot, I have an ipad2 and I knew apple will shoot out another ipad every year and I will miss out on applications because of this.  This is how tech world moves.  Shoot, I have some games on my ipad that I cannot update because the update uses tech for the new ipad3. 
I guess what I am saying is each year we should expect changes and not all of them will coexist with our current hardware.

Considering you're not that smart, LOTS of new stuff is coming for the current Lumias, you're whining for nothing at all! Stuff a sock in it... =p

Not exactly happy considering the fact that developers will jump on the native code bandwagon to take advantage of the performance, so there's a problem IMO.
Still, it's the best they can get now.

Now tell me how this is gonna play out. As a developer you want to write an app and make money from it. Are you gonna write it such that at least 20 million people give or take has access to or just, well, zero?. Trust me most apps are still gonna work with current devices for at least another year.

People are so damn stupid sometimes.
Do you REALLY think developers are all going to run right out and make a bunch of apps that only run on WP8 when WP7 apps will run on BOTH WP7 AND WP8 and the installed base of WP7 phones is 20 million plus and WP8 will take YEARS to reach that?
It makes absolutely no sense. 
It will be at LEAST a year before you see any significant number of WP8 only apps and even then it will be a slow start. 
So by all means, race out and sell your WP7 phones and buy new ones and hurry up and wait for that avalanche of WP8 apps which is going to take a minimum 12-18 months to arrive. Or sell your WP7 phone in protest and go buy a buggy Android. Whatever.
Some of you are a bunch of impatient, immature children. It's ridiculous. Only an idiot who doesn't have the slightest understanding of how software development works would think WP7 phones are going to magically be left high and dry the day after the first WP8 phone goes on sale. Bunch of overreacting jackasses. 

Legacy?  You mean the devices that are selling TODAY for $99/$199 with a 24-month contract?
Yikes MSFT.  As a Titan II owner, I guess I understand but am disappointed that my phone is already "Legacy."

That's very true. You can walk in to At&T and get a brand new Lumia and already be a legacy device? That's not right.

"Right" or not, Legacy is a technical term, meaning -- in this context -- "hardware that we built to in our last generation." From the standpoint of WP8, which is still being developed, and is being developed to a new hardware spec, *everything* currently on the market would be considered "legacy."
This is not a new concept: in every software domain, the moment anyone starts developing against a new standard, the current standard becomes "legacy." It's not meant to be an insult.

As someone in the software world, this is very difficult to make a consumer understand..
just like a car losing value as soon as you drive it off the lot, the phone you walk out the store with is worth less and on a OS that is outdated..
People expect too much and make alot of demands...

When did apple have a buy back program for the iPhone?? I work for ATT and I dont remember ever having an iPhone buyback program because a new model came out. AT&T does have a buy back program but that's for any type of phone, not just iPhone.

I was just about to say that and doesn't it cost $150? I do know that the apple store direct wants $150 to exchange the iphone 4 to 4s

Well it's better than nothing. Too bad I'm stuck in a 2 year contract before I can upgrade. That's ages in technology years!

T-Mo lets you upgrade after 21 but you can argue 19. 
Good to know I have options now though.  7.8 will carry my DVP until I get a WP 8 device.  I'm cool with that.  Had a good run.  Pre-Nodo, No-do, Mango, 8107, 7.8 is respectable. 

I can understand that current hardware doesn't have dual-core SOC's or NFC, but is a DC SOC really needed for Windows 8 kernel/core?  That's something I would love to know.  I hope all of the Windows 8 features they have shown (minus NFC) are coming to Windows Phone 7.8.

Well, assume for a minute that Microsoft is so full of awesome that they'd spare no expense to modify the Win8 kernel and all of their code so it can run on older devices. You'd still be screwed, because the OEMs would never agree to rewrite ALL of their chipset drivers to switch from the WinCE driver model to the Win8 driver model. It's just a fundamental incompatibility issue that's not feasible to solve. So I think the fact that Microsoft is committing resources to bring a good chunk of Apollo functionality back to Mango shows how much they do care about their "legacy" customers, and that they are in fact pretty full of awesome. They totally didn't have to do that.

I'm happy for any update MS will give me to look like Windows Phone 8 with customizable tiles and some.

Wrong. They had to do that our risk alienating every single customer who's bought into the platform in the last 8 months. I can't imagine how that would register on the Richter scale of nerdrage across the internets.

While I understand hardware limitations, I am very disappointed that I will not be running 8 on my Gen 1 device.

What I am disappointed about is that good ole AT&T withheld my 8107 update thus not giving me a back up point since Mango, In that amount of time I was doomed to loose the messages concerning birth of grandchild with the videos and back and forth on that event. Now don't get me wrong I really have loved my phone, but there is another "but" as when my "Legacy" device had a hardware problem and needed to be replaced under warranty, that is when I found what that 8107 update cost me in not only unrecoverable memory loss but I also found that Microsoft had no regular back up or recovery through Zune I had mistakingly assumed each time I synced to Zune on my computer restore points were being made (thanks to Skdrive and Snapcrowd )I had backed up all photos and music.Now I am unable to reinstall any pre-paid apps and what ever personalization in those apps, but am also out of luck on any of the hundreds of personalizations we all put hours into our phones making lists etc. etc. . The replacement phone is identical to original but there being no recovery or backup I have lost any data such as assigned ring tones groupings text msg strings and on and on, the replacement phone is effectively a do over the day I first walked out of AT&T. You just can not believe how much "tweaking" this involves over many months of using your phone, what have all of the people who have upgraded their phones done about having to start over each time they have bought a new or replacement phone ? Guess I should have figured a way to back all of this up before my device failure, did MSFT provide a way to migrate I was just too stupid to find?
Truly sorry for the rant but venting some how makes me feel a little less screwed for never getting the 8107 that I think would have saved or at least lessened my data losses.

I think this is the biggest flaw in the current Windows Phone implementation. However, one of your concerns - access to paid apps -- is possible. Just go back to the app you bought in the Marketplace and go to purchase it again. The system knows from your Windows Live ID (assuming you're still using the same one) that you've already bought the apps and will not require you to pay again.
Pictures and music should be backed up in Zune. All your pictures will be in a sub folder in your "My Pictures" folder. They will not automatically be copied back over to your phone, but you can do this in Zune by dragging them back onto the phone.
But you're right about everything else. All other data, phone and text history, customization, game progress/scores, etc. is lost and needs to be rebuilt from scratch. I had 3 stars on every level of Angry Birds (already repeated from having done that on my previous Palm Pre), and now after re-installing the app (for free at least), all the levels are locked again as if I've never played the game.
Interestingly, some apps do seem to maintain their data, like the destination list in the GPS directional software. I think this means that the apps themselves could also do something to save your data on their own servers, if they wanted. It's just that almost none of them seem to do that, and they shouldn't have to. MS should do what you said - backup everything each time you sync, especially since that is done by connecting to your own personal computer anyway (it's not like it's taking up space on their servers or eating up carrier bandwidth).

People whine too much. This is fair by a long shot seeing as how we can't upgrade the hardware. And they'll continue to develop apps for us.

I agree. And many people seem upset at HTC and Nokia for releasing phones which so soon are "Legacy", but 1. Nokia needed the money and 2. would you rather we only had our first-gen devices for the year or two that many of us have? It was the logical move, and Windows Phone 8 is going to rock.

+1. The reality is most people don't care that their phone doesn't get upgraded so long as it still works fine. What percent of current Android and iOS devices will NOT be able to run the full version of Jelly Bean (assuming this comes out this fall as I would expect) and iOS? I know plenty of people that have said they were waiting for Windows Phone 8 before getting one. Actually, I know more people that were waiting for WP8 than WP7.5 users.
I bought my Lumia 710 off contract and, until PureView comes to Windows Phone, I see no reason to buy a Windows Phone 8 device. Only the truly die-hard users ever buy all the latest devices. Since most of the world is far from being a die-hard user, I don't think 7.8 vs 8.0 is really going to cause much more than a blip of a fraction of a percent in marketshare with people that refuse to buy a Windows Phone again vs. how many people are going to buy a Windows Phone 8 because it's what they were waiting for or because they were so happy with their Windows Phone 7.5.

I agree also.  I am glad they didn't forget us.  Very excited for the update.  My Lumia 900 is the best phone I have ever had, so I am excited about extending it's life.

As expected..
tbh, expecting WP8 to run on  current devices would be much like iPhone running OS X

I'm fine with this.  I was going to buy an new WP8 device anyway.  Hopefully with Pureview. 

Exactly my thought when I preordered Lumia 900. Plus wp8 update is still months away. I guess I'll be fine for the time being.

Microsoft had to do something like this otherwise they would be undoing all the good work they have built with WP7. The 7.8 update is a compromise, but im thinking of a the Lumia 900 owners here, they've kind of been cheated in a way.

As a Lumia 900 owner, I'm not sure I'm dissapointed.  I would really need to see what features will be available in 7.8 versus 8 (minus all of the hardware features that would require newer devices.)

I don't think so. They also showed some nice Nokia-exclusive app upgrades that will be coming in 7.8. Under the circumstances, I think MS really did well with this. It could have been a nightmare disaster (I'm looking at you, Android ICS.) In fact, I'm tempted to pick up a gently used 900 off eBay for cheap when the WP8 devices start rolling out. 

You can pick mine up now if you like! Just reply to this message with a means of contact. Mine is very gently used! l

I'm a little disappointed that the most recent phones aren't going to support WP8.  Not having native games is a bit of a bummer.  At the same time, I get it.  The hard part is the original WP7 customers will be able to upgrade, but the newest customers get hosed in the long run.

i would think that the lack of NT kernel means a halt in new app development? If this is true, then this really sucks because no more new apps will be released

Guys, lets not blame MS for this flop; I too am a Lumia 900 owner yet I don't blame them. The manufacturers knew all about Apollo and chose to put the L900 & Titan II out with lower specs/screens than Apollo requires (We should pressure them to implement a buy back or something). They knew all about Apollo's Kernel, etc before release these lated devices.

I agree about not blaming MS but I wouldn't expect oems to put money into hardware the OS didnt support. Image having a dual core WP7 with HD display and NFC, but never being able to use the features (or if this was able to upgrade to wp8, doubtful, you'd have to wait a while). In the world of technology this makes no sense.

I agree it was very short sighted of Nokia to release the 900 with legacy hardware... How cool would it have been if the Nokia guy came out and said and buy the way any 900 user qualify cause we put a DC chip in ;). Oh well, its mostly a good phone. And that start screen look cool.

As an HTC Arrive user waiting on a new Windows Phone option on Sprint, I am excited that we will be getting some of the features of WP8 to tide us over. Its not a perfect solution as initially there will be some fragmenting of the market, but it is better than just leaving us legacy users behind. Very excited about the future of WP!

I have an Arrive as well. You're right, assuming that Sprint will bother pushing out this update.

I think Sprint has abandoned ship, which is too bad since I love the Arrive.  7.8 will be a nice hold over, but as soon as I'm off contract in the Spring I'm grabbing the first WP8 Nokia with a keyboard.

I agree.  Not sure why sprint even carried the device since they did ZERO in the way of selling, pushing, or training their employees about the device. 

Paul Thurrott is claiming that WP 7.8 will be pushed to all customers by Microsoft -- not the carriers.  Of course, this is the same Paul Thurrott that was adamant that there would be no such upgrade at all, so who knows.

Just another Sprint Arrive user chiming in. I say, something is better than nothing at all. I'm good with this. I think they're kinda meeting us halfway, and that is a fair shake and then some. But yes, here is hoping SPRINT gets on the ball and pushes this update to us, if at all!!! (not to mention pick up three or four WP8 handsets)

Same thing. I've been wanting to switch to AT&T, but by the time my contract ends, Sprint may have WP8 devices out.

Eh. Not really excited. I've only had my phone since last November. Now I'm stuck with a phone that's going to miss out on alot of new and exciting apps unless I fork over another 500 - 600 off contract. /sigh

Yeah that's probably what I'll end up doing. I think my first purchase is going to be a surface tablet though. :)

Your wp7 handsets are frickin worthless now, there will be a boat load of suppliers trying to off load them, who the feck is gunna sign up for a two year contract on a dead platform.

They are giving us as much as they can with hardware limitations.  The new layout and other built in features are exactly what we needed.

Hardware required things like Native support (New Kernel), NFC ect I wasn't expecting.

I think the compromise is just fine (: im still going to be getting me some new hardware but in the mean time while I save up for a new phone. I still get enjoy some of windows phone 8 features on my titian. :D

Its fair, thanks Microsoft..next time I'll be more patient. Just like retina mac pro..waiting for 13inch instead of spending 2k. I'll get a wp8 device next year ;)

Hopefully Microsoft will still try get games pushed out to WP7 when it comes to LIVE Enabled Titles either way I'm fine with my Phone in the future I think I want to get a Microsoft Surface :P My current HTC Trophy does a fine job right now for when I'm out and about or fancy playing a game!
Phone Screens are not just big enough to play anything that tries to use Virtual Analog Sticks anyways its a awful experiance!

When was this announced? I have been watching the Windows Phone Summit and didn't hear this mentioned. 
As a Lumia 800 owner I am annoyed.

The press was briefed on this bit of detail prior to the event. The embargo was lifted at 10am so they're sharing this with the world now.

I hope you're directing that at Nokia and HTC because both of them knew about Apollo prior to releasing the 900 & Titan II. I appreciate MS making and effort to provide us with an upgrade but hoping cellular carrier offer a trade-in. We as users also know multi-cores and betters screen were coming but we couldn't display a little patience....That a fact, so blame yourself as well!

Its a good thing I got my trophy free from that ms store challenge offer or I would be pissed. Hello fragmentation!

You're missing the point,we get everything WP8 gets except for native code apps. Can't say the same for Android

All we know is we get that new start screen. Native coded programs won't run. It's not clear if important features like the direct skype integration will come (don't think so). They will use a little paint to make Windows 7 look like Windows 8 and then abandon it.

Yeah! Define fragmentation for me, too. I keep seeing that word bandied about and after I finish reading their post I'm left with the thought that I didn't know a lobotomy was elective surgery.

So MS should freeze their capabilities circa 2010?  This isn't fragmentation, it's evolution.  It seems like non-hardware dependendant WP8 features will appear on ALL WP7 devices.  I can show you Android devices sold less than 6 months ago still rocking Froyo.  This is the opposite of fragmentation, it's the rollout of a new OS, and oh by the way a SECOND OS to give legacy users as close to the new experience as hardware allows.  Google only wishes they could keep their ecosystem this integrated.

It's refreshing to see there is at least one person here who knows what the word fragmentation means when it comes to OS's. There are too many clueless idiots throwing that word lately. 

I think this is a very fair compromise. Knowing that many of the new features of Appollo are hardware related (i.e. resolution, NFC, multicore support), at least they're giving early adopters some sort of Appollo love and not much of a fragmentation issue.
Cool! Way cool!

Don't feel that way until you see what all you get with the upgrade. We knew going in that WP8 would have hardware upgrades that the current and older models wouldn't be able to get.
So you're technically crying over spilled milk. Nothing you can do about it now.

Seriously its not any different then buying an iPhone4s right now. come this fall it will probably me legacy too and more than likely not get all the new advancements just like how the iPhone4 didnt get siri. I'm just happy Microsoft is taking apples route instead of androids. We still get an update but only stuff our current hardware can handle.

Would you be just as pissed if you bought any of the other 2nd generation WP handsets (i.e. Titan, Titan II, HTC Radar, etc.)?

Thats fine by me, I have no problem understanding that I can't have features that my cellphone doesn't support (Lumia 800). I will see in autumn what cellphone I will buy ( of course a WP 8).

The Smartphone Beta test is over :D Yeah right Ben...
With Android I could now flash a custom ROM, I can't with WP7, still the fanboys are happy :D

Good for you.  Now give yourself a pat on the back.  Consumers won't know how to do this, and they just expect things to work.

You can flash a custom Android ROM that has functionality centering around NFC into a phone that does not have NFC hardware and have that ROM work?  Wow.  Android is MAGICAL!

Been there and done that on an xperia. Call volume all over the place, crashes and no camera. I personally found ICS custom roms a waste of time.

Exactly, i dont care about NFC, resolutions and what not - but there will be a lot of apps that will simply not be available for 7.x phones. 
I have only a cheap 710 - but i can see how someone with a new expensive phone he bought recently would be pissed off by this.
P.S. this will fk over nokia sales for the next months too

I got my Focus for free on 3yr contract. After 1 yr, I upgraded to Lumia for only $35 after rebates, and only extend my contract by 1 yr. Hopefully by the time WP8 comes out, I can upgrade again spring 2013! :D

Lol my gf has been dying to upgrade but i told her no because of wp8 coming. I kne we would only get some of the wp8 experience hince being smart and waiting

my brand new phone outdated just like that <Sighs> o well i love my lumia and as long as i get some taste of wp8 its better than no taste at all but i will deffinately be buying a new wp8 device and a surface i hope they get bundled :)

Hopefully 7.8 is not something that only looks like wp8. I didn't buy lumia 900 for looks!!.. Might have to sell my phone!!

Well I guess most people did just that and bought the 900 and the 800 on looks and they have not changed.

Obviously we need to know what 7.8 and 8 means in everyday use but this on the face of it sounds like a fair compromise especially considering the difference in OS.

Why are some of you disappointed?... We all knew Apollo was coming... Did you not expect hardware upgrades. I was afraid their wouldn't be. Looking fwd to WP8!

A lot of people don't read blogs about phones, so they didn't (probably still don't) know what Apollo is, but still bought new WP7 phones recently due to the hyping of the 900s. They don't even know yet that their new phone is now EOL'd.

I guess you're right. But folks that's do read blogs and are true to WP are crying like they got raped... Hilarious!

I'm on my 2nd WP now (NL900) and was hoping with the update the screen resolution would be addressed - I thought surely this feature-packed phone had the ability for better video playback resolution than what it has. I read that it was limited by the OS so with an OS upgrade I was SURE that while some things wouldn't be possible this would. So, just got new phone and now for 2 years I get to watch everyone else have the good stuff. Thanks WP.

Resolution is a physical property of the display. You can't magically increase resolution through software updates.

Exactly. It's like buying a new car one year and the next year a newer model comes out with a better feature.
Firmware upgrades/updates is software, but hardware updates just isn't possible. And for those who don't read phone blogs, then this really won't matter to them, now will it?
They'll receive an update and think it's the best thing in the world.

Don't mean to pile on, but that's the same thing as being disappointed because the upgrade won't turn your black 900 into a magenta 900. A software update cannot change the hardware into something it isn't.

stopped watching stream.
Had a HD7 since launch in UK, then upgraded (upgraded is a joke word in this instance) to a lumia 900
absolutely shafted, Lumia 900, 1 month old, now a legacy device, waste of fu(king money (2 year contract, MS should be hung up for pushing lumias onto people when they are outdated within a month).
iOS and android owners will be pi$$ing themselves at WP early adopters

Just upgrade after 1year... If you haggle w/ your provider Im sure you'll fine. Apollo was announced since last year... People should have waited a few months.

I know right?
Didn't you know that something you loved yesterday suddenly sucks and is a piece of junk if something new is announced? 
It's hilarious to watch the idiot consumer sheep getting all worked up in a lather about this. All the entitlement and personal offense. Like Nokia insulted their mothers. So ridiculous. It's business people, get over it. Stuff has to be updated sometime. No one owes you endless update compatibility. The line has to be drawn somewhere. I have a Lumia 900 and I'm not crying like a little baby with a full diaper over this. My phone is just as awesome as it was the day before the announcement. It's not a big deal.
I have a phone I love, which was FREE in my case, thanks to Nokia's generous refund, but was still a bargain at $99. Now I just found out I'm getting a really nice software update with a cooler start screen. I'm super happy about that. The world is not going to end just because I can't upgrade this phone to WP8. It's going to take the length of my contract before there are even a significant number of WP8 apps out to take advantage of anyway.
So I'll enjoy the phone I have until then. Let them work the bugs out of WP8 and let the developers start to get their feet wet. By the time my contact is up, WP8 will be well vetted and there will actually be some apps for it and Nokia will probably have had time to make a pureview Lumia by then.
Until then, excuse me if I don't join the whining baby parade, I'm too busy enjoying what I've already got. 

Chillax. The phone is just announced. Nobody can buy it yet. So enjoy the Lumia and all the Nokia apps. By the time WP8 comes out, you won't have long to wait before you can renegotiate with your carrier.

My upgrade i think is Summer 2013, but not in a rush to get wp8 phone until i see what Nokia is putting out. 

Believe it not, I liked the off center "gutter" look, but no biggie. What I am worries about, is what is going to happen to those of us with phones from companies that sold us lemons and ran and hid because they didn't want to deal with it, aka The Dell Venue Pro. So, since Dell is no longer selling or supporting the Venue Pro, does that mean no 7.8?

Gutter always bothered me, OCD in me I guess. Why would anyone like it though? I don't understand. Why not maximize available screen space?

It does a lot for the tiles. If you remove it and scale the columns to fill the space there would only be room for about 3⅓ rows, and I think cutting that much off the bottom row would have looked really bad.

Off-centering and slight asymmetry are very aesthetically pleasing believe it or not.Take a random picture of somebody's face, cut one half  off and mirror the other half so you get a perfectly symmetrical face. You will see that that face looks just weird. That being said, eventhough I like the gutter, I like the new homescreen as well, it does a better job at conveying the illusion that there is a wall of information and you just focus on some part of it through your screen.

Does 7.8 include a screen orientation lock?!  I will not be happy with Windows Phone until I get that "feature".
Part of me is fine with the 7.8 update and part of me thinks that it's crazy that a phone that came out in April 2012 is given "legacy" status in June 2012.  Even Android hardware is current for longer than two months.

The update seems okay, but I had been somewhat hopeful of them bringing at least some more sophisticated networking options to the device. I figured the update might allow me to access my corporate network (EAPS-TTLS that can be accessed by every other mobile os on the market) and the way it looks I might have to look for a different phone for that reason :-(.

I hope DFT or someone on xda can port wp8 to our 2nd Gen wp7.5. Either way 7.8 is good for now. I would rather have a phone with multiple cores flying on wp8 than a sluggish Android on multiple cores.

You in the market for a Cyan blue Nokia 900?  I will probably go crawling back to iOS or Android.  Who knows.

And you do realise your iPhone or Android will be legacy once they announce their new OS version? This is how the smartphone world works. It moves fast. If you want to keep up you have dish the cash, otherwise be happy with what you got and when you can upgrade you get the latest and greatest at that time.

I have  mixed feelings about this, I love the new start screen UI, and am happy were getting that, I'm a little upset  about not getting the new kernel so the windows phone 8 apps won't work. Then again I don't really use apps that often so I don't care that much. 
Its a good compromise, and by the time I start caring about new apps not working I'll be able to upgrade.

What sense does it make to be upset that you're not getting the Win8 kernel? It won't run on existing WP7 devices anyway. MS can't give you something in an update that your hardware cannot run.
Overall, I agree that this is a very good compromise. It's more than I was expecting, that's for sure.

I'm still holding out for more memory, or flexible memory like I have in the original Focus. To me storage is the most important feature; no need to upgrade until a new model offers parity with what I have today. Or despite my other issues with it, my next phone could be Android after all.

They could just as easily have not bothered calling it 7.8 and just said 8 minus certain features and this would have been a non-issue. It's really no different than older iPhones not getting features in a new iOS release. The 4 doesn't have Siri and that wasn't even due to a hardware limitation.

You forget about the lack of app development. All iPhones can run apps assuming that there are no hardware requirements because the kernel is the same

This is more about the SDK used. iPhone apps written with, say, the 5.0 SDK won't run on an iPhone 3G (iOS 4.1.2 is the last version available for it). But, developers can use XCode to make an app for 4.1.2 (or earlier), to ensure a wider audience, so long as they don't need any new features the newer SDK affords (often providing access to new hardware or software features).
The same thing applies here - Visual Studio will still let developers build apps for WP7.5 (and 7.8) - and Microsoft said at the conference they recommend most apps should continue to be built with XML & C#. If a developer doesn't have to use a new hardware feature, there's no real harm in compiling for last-gen devices, and they'd be smart to do that as they'll have a wider audience to consume their product.
Granted, we'll probably not see the same influx of games for WP7.8 due to the lack of C/C++ support, but many games are developed in XNA and will still support current devices.
Semi-related example: The developer of SpellTower on iOS released it using the 5.0 SDK - I couldn't install it on my iPhone 3G, and contacted him (along with others) - and he was nice enough to update the app (which didn't rely on anything special in iOS5) so I could buy it and run it on my older device. I'd think a similar situation would apply to existing WinPhone devices.

now that's a good explanation :) I also think the situation is not as bad as most people make it out to be. They have said that there will probably be other things included in 7.8 so I'm guessing it will bring everything from 8 that our current hardware is capable of.

Yeah, a spiffy new interface, new Maps, and (maybe) the Wallet sans NFC.

What we're not getting:

New apps. How many new apps do you think will be written for WP7 once WP8 comes out? Not many is my prediction. I'm sure there will be some but the vast majority are going to be written to WP8 (how many new WP6.x apps were written when WP7 came out?). Sorry guys. I hope everyone likes the apps they have because within a few months they won't be getting any new ones. Really sucks. We'll have to sit there and watch while our iPhone, Android, Windows Phone, AND BB users get to play with cool new apps while we sit here playing with a 3 year old version of Angry Birds.

Not just new apps. No doubt MS will help the big name ones (through support or raw cash) switch over to RT to create a showcase of great brand-name apps for WP8.

Sorry but the situation with WM6 was completely different. As long as you don't use native code or any special new hardware (e.g. a specific nfc app) will be able to run on WP7.8. Haven't you read one of the other articles? It litteraly states: "applications for Windows Phone 7.x will automatically run on Windows Phone 8 with little or no changes to the code of the app.  Apps coded on Windows Phone 8 will conversely run on Windows Phone 7.x as well so long as they don’t use native coding" (- Daniel Rubino) so what you are saying is just not correct.

Obviously the lack of hardware support means some features would be impossible on current devices. The lack of ability to run native apps/games is a pretty big blow since they used native development as a way to justify why big name apps/games haven't come out yet. Now we won't get them anyway until we get a new phone.
I don't like the gutterless Start screen. The numbers on small tiles run into the right-side edge of the tile (there was an image of an outlook tile with 80 messages). The normal-sized tiles appear larger now to fill in the gutter which means you can't fit as many normal-sized tiles height-wise on the screen at once.
I understand why they're making these changes, but it's happening at the cost of damaging the design aesthetic. It just looks sloppy.

You dnt have to have the small tiles if you don't like them... You can customize it anyway you like... Or keep it the way it is... No worries there!