Apple had to take quite a bit of criticism and ridicule for not offering copy and paste on the iPhone. iPhone OS 3.0 released in 2009 brought copy and paste to the iPhone. Microsoft's decision to not have copy and paste in the Windows Phone 7 feature set was risky. Today during the launch event Joe Belfiore did some damage control by announcing copy and paste for early 2011.
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The feature will be part of a software update for Windows Phone 7. Belfiore argued that Microsoft got feedback from testers and partners that this feature is important. In the meantime you have to use the Windows Phone 7 QWERTY keyboard. At least Joe Belfiore can type very fast on a Windows Phone 7.