Difference Between Hotmail and Outlook

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The major difference is both are different ways of looking at the same information.  MS is upgrading everyone gradually.

Your Hotmail address will continue to work

Do you have specific questions that need answering?

Outlook.com is a new service that runs alongside Hotmail. 

Although we are encouraging our Hotmail users to upgrade, you don’t have to do so YET, but we suggest you familiarize yourself with it now.

Over time, the Outlook.com experience will continue to improve and we’ll eventually want to provide the Outlook user experience to everyone including users with an @hotmail.com address. 

You can try Outlook without a new account and without changing your username/password – just use your @hotmail.com account to log into http://outlook.com.

It’s important to remember that, no matter when you upgrade, your @hotmail.com address will always work.

 When you upgrade, you will be able to send/receive mail and you will retain all your mail, contacts, calendars, and rules.

http://blogs.office.com/b/microsoft-outlook/archive/2012/08/03/upgrade-from-hotmail-to-outlook-com.aspx