What happened to Windows Mobile 7?

At last year’s Mobile World Congress there was a good deal of chatter regarding Windows Mobile 7 – particularly around the Sony Ericsson Xperia X1. Almost a year later, the X1 has shipped (with Windows Mobile 6) and now the talk is around Windows Mobile 6.5 and it’s looking set for devices scheduled to ship in Q4.

I’m not a windows mobile expert and I don’t even play one here so I can’t say whether this is semantics (6.5=7) or some backpedaling … What am I missing here?