It’s not the update you’re expecting though! You may see a little notification on your phone that an update is available. If and when that happens you’ll have to plug your phone into the Zune client on the desktop with your USB cable. The Zune client might have to download an update too. If you’d like you can open Zune on the PC first and search for updates there. Either way, that will get updated and restart. Then you can update the phone. If you have a Mac instead, of course the Windows Phone 7 Connector for Mac will work as well.
Unfortunately this is not the “NoDo” update that brings speed improvements, Copy/Paste, and CDMA support. This is just a small update that prepares the phone for subsequent updates. In other words, it makes some changes to the update process so that the phone can recieve future updates. In order to make sure the process goes smoothly, not everyone will recieve the update at once.
For more info on the Windows Phone 7 Update process, update history, and “How To’s”, see this Windows Phone Support page.
UPDATE: Also see the Microsoft Windows Phone blog for more information.
Source: Microsoft Digital Marketing Department