Microsoft's not spilling the beans on what's updated on the Zune 1.2 Firmware release, but after a few minutes of playing around with the device we notice some definite speed improvements. Drilling into the video menu has barely any lag now, and browsing through a large list of songs—even bringing the list up—is noticeably faster.
Zune Boards say picture viewing is also less laggy, but don't notice anything new in the way of features.
To update, just connect your Zune, right click on it, and "Check for Zune Device Updates".
Left: An interesting Zune ad.