Back up, sync, and restore your phone
Your phone is automatically backed up during the software update, when you update the phone using the primary computer (the computer you first connected your phone to with the USB cable). If you use a different computer to update your phone software, no backup is created. You can change your primary computer in the Zune settings.
The backup includes the following:
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System settings
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Account settings
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Pictures
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Music
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Videos
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Documents
Your downloaded apps may not be included in the backup, but you can re-download them from the Marketplace, free of charge. Data transmission costs may apply. For more info, contact your network service provider.
To back up your content, you can also sync your phone to your computer with Zune or Windows Phone 7 Connector for Mac without updating your phone software. Syncing does not back up your system settings or your apps. You can also set your phone to sync your contacts through Microsoft Outlook, so you can restore them to your phone from your computer.
Use a USB cable to connect your phone to your primary computer, then use Zune to restore your backed up content and the earlier version of your phone software.