The newest OS update for iPod Touch and iPhone (formally iPhone x.x) is iOS 4. Apple chose not to support its first generation iPhone and iPod Touch devices with the OS, and only partly support devices other than the iPhone 3GS and iPad and iPhone 4.
I don't blame Apple for not wanting to implement all the parts of iOS 4 on older devices. Multitasking and complex graphics won't fly on the 1G devices. But by leaving users without any OS upgrade path, it also leaves those users with no way to update the apps they have already purchased or downloaded on their devices. And new apps won't work on iOS 4, AFAIK. This is because devs have no incentive or way to make their iOS 4 apps backwards compatible.
In one fell swoop, Apple has cut off these users from access to new apps or new versions iOS 3 apps from the App store. Users of 1 G devices get app upgrade notices, but can't take advantage of them at all.
Hey, I don't need multitasking or bluetooth keyboard connectivity, or the myriad of other features iOS 4 has. But the cutoff from the app store (and fixes to my current apps) is really unforgivable.
Thanks for nothing to those of us that got the iPhone & iPod Touch ball rolling in the first place.
Way to go, greedsters.