Thank you for reporting this bug.

Unfortunately, canonical's commercial repositories for Gusty are not yet
operational. De-selecting the canonical gutsy commercial repositories
should allow the upgrade to proceed normally.

I'm sorry but I do not know when the repositories will become
operational or why they have been delayed.

-- 
Error during upgrade to Kubuntu 7.10 : Failed to fetch
https://bugs.launchpad.net/bugs/154710
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