Windows Phone SDK was recently updated to the version 7.1.1.This update adds two of the new and important features for the developers.

Firstly it adds support for Windows 8,so that developers who are using the Windows 8 Consumer Preview can now develop the apps using the new updated SDK.Other new important feature is that now the SDK supports the lower end Windows Phone devices which were introduced recently with new updated chassis specifications which includes only 256MB of  Onboard Memory unlike the usual 512 MB Memory of the first generation devices.

So this means that developers can develop the apps for the devices like the Nokia Lumia 610 which run on such specification with the Tango update onboard.

Here’s what it actually updates on your original install,

• The Visual Studio IDE is patched to enable selection from a list of emulators, and launching it (note that the WPSDK can only support connecting to one at a time, though)
• The Windows Phone [512 MB device] emulator image is updated to use build 8773
• A second, new emulator device image is included, allowing you to emulate running your app on a 256 MB device
• The Microsoft Advertising SDK is updated to the latest version (previously only available as a separate install), which fixes some issues devs were encountering at runtime
• IntelliSense now supports specifying the 512 MB device requirement in your manifest file, should you choose to opt your app out from running on the new 256 MB devices
• Language support is again consistent both in the IDE (the 7.1.1 Update supports all 10 of the WPSDK 7.1 languages) and in the emulator OS (Malay and Indonesian have been added)

Though the update adds support for Windows 8,its not officially supported until the RTM of Windows 8,One more thing is that if you have Hyper-V enabled the performance of emulator will be degraded.

Checkout the official blogpost for more details on developing apps on 256MB devices and much more.