From a users perspective a bunch of niggles and gaps have been dealt with - particularly MMS, cut and paste, searching using Spotlight across apps, horizontal keyboard mode for all apps and particularly email and a nifty little dictaphone app. But that's it. No new iPhone Nano, no major Safari upgrade and few new breakthrough's to cloud based services. At least you will be able to synchronize your calendar with Google Calendar - Yaargh!
Let's hope Apple shine with hardware innovation and 'cool' factor in the next version. They're gonna need it to keep iPhone sales rising and the competition at bay. Cos Microsoft and Palm are hot on their heels.
From a developers perspective this is a major step forwards with a 1,000 new API's covering everything from subscription charging models to embedding maps and email into app synchronized updates and loads more. Proving that the future of the iPhone is as platform. Period.