I had submitted a reply here yesterday and am surprised to find it disappeared over night.
As I was experiencing that same update error I researched many forums and tried a solution another person had found for himself. So far this solution has helped me and my wife (on two different PCs) to get the update working. Disclaimer: my Windows 7 is
in German and I might translate some menu items poorly. Here it goes:
In the "Start" menu go to "System Control", within "System Control" go to "Services", or via "Administration" to "Services". In Services is an item called something like "Notification on system events", which seems to be set to "manual" by default. Start
this service and try your Zune / Phone 7 update again. It should run smoothly now.
I am still surprised that this is not handled by the update routine, or that no more meaningful error message is issued. Anyway, good luck!
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