Upgraded my 3GS last night and it was painless overall.
Although it's not a huge jump in terms of functionality I'm pleased there's no performance hit on my older phone, that along with iCloud make it worth the upgrade. The improved camera app (hey a physical shutter button!) is great as well.
Overall a solid but not huge upgrade, at the least it kills my lust for an iPhone 4S, so I'll stick with my 3GS for one more year and upgrade next year after my contract is up.
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