We've previously reported about a huge Windows Phone 7 update that is meant to hit early next year but now there are rumbles of a 'major' update coming late next year.
The update which is codenamed "Mango" will effectively amount to Windows Phone 7.5 - which is also rumored to be the actual name when released. Mango is rumored to bring Silverlight runtime and HTML5 support to WP7. Other features might include Far Eastern language support and other unknown features or functionality at this time.
Windows Phone 8 is the next step - codenamed "Apollo" and due in late 2012.