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First I was upset. Then I was mad. After thinking about it some more I was slightly more understanding. Now, after thinking about it for a day, I'm just plain mad.

I'm talking about Microsoft's big announcement yesterday concerning the next version of their smartphone operating system, Widows Phone 8.

I've dealt with some of the people behind Windows Phone in the past and I believe them to be great guys.. And very, very smart.

I really like the current Windows Phone 7.5 despite its shortcomings. I actually use it myself. Every day. No, it's not iOS or Android. But, it's multicolor tiled “Home” screen allows me to be informed about all the important incoming messages in one quick glance. I find it more handy than either of the others.

And I understand that Microsoft has to add more and more mobile features to compete. Actually, to survive.

WP8 will have an improved Start screen, support for multi-core processors and lots more operating memory, better VoIP integration (hey, they do own Skype), NFC (everybody wants a piece of the tap-and-buy society of the future) and lots more.

Sounds like much needed improvements.. Especially considering what Android and iOS offer now (and what they'll add in the near future).

But, what I'm upset about is the incompatibility issue. Windows Phone 8 won't work on current WP 7.5 hardware. Current models such as Nokia's Lumia 900, 800 and 710, plus HTC's Titan II and Radar. Those devices will not be able to run WP8. That's almost criminal.

I understand, technology-wise whey they're doing what they're doing. the new OS needs new hardware to grow. And, I realize Microsoft is offering a half-way measure of sorts – an upgrade for current phones to something called WP 7.8. They say 7.8 will have some of the new stuff from WP8. But, bottom line, it ain't WP8.

Can you imagine what would happen if Google excluded all of their older models from being able to run Android 4.0? Or older Apple hardware with newer iOS? At least most of Apple's older stuff can run new iOS versions minus some of the new features that won't work on anything but the latest models.

That way smartphone buyers don't feel cheated. You tell them to upgrade to the next, greatest version of the software and get most of the benefits – but if they want ALL the new features they'll need get the new hardware. It's an Apple-esque marketing opportunity that Microsoft just blew. Big time.

So now how do they make (the relatively few) Windows Phone owners happy? Especially the ones who just signed-up for a Lumia 900 with its two-year contract noose? It's a PR nightmare. One that Microsoft needs to address quickly.