This is a serious problem for Apple, because all those 16 GB devices (let alone the 8 GB ones) aren’t going to suddenly gain more free storage space on their own. A lot of these devices might never get updated to iOS 8, but would if the OTA software worked. Unless they can rejigger the OTA software update to require less free space, iOS 8’s adoption rate might lag permanently.
It's a chicken-and-egg problem: iOS 8's (upcoming) iCloud Photo Library and new message deletion settings could alleviate storage issues, but upgrading to iOS 8 is still required to use those features.
(It'd be interesting to see Apple porting storage-saving features back to iOS 7.)