Will "Set up as new iPhone" delete everything on there?

Hi there! I'll try to be brief;

-Had iPhone 4S for 1+ year
-Never bothered to connect it to iTunes on my laptop (only did that with my iPod and ipad)
-icloud was full from ipad crap so haven't backed up iphone in foreverrrr
-I need dat iOS8!!! (and the space, don't want delete everything though...)
-Everyone's recommending doing it through iTunes so...
-I connected my iphone and its treating it as a new phone, giving me 2 options:
"Set up as new iphone" or
"Restore from backup".

I'm pretty sure I don't want to restore but will setting up as a new iphone delete all the 1000 photos, apps, etc thats currently on my NOT new phone?

Any suggestions would be very appreciated! Thanks for reading!

Setting it up as a new iPhone will not delete anything, however, make a backup of all your photos and music before doing so just in case something goes wrong. And the apps you have on your iPhone if purchased from the iTunes app store can always be downloaded again for free if something should happen to them.

Don't be in too much of a hurry to update to iOS8. see this link iOS app devs warn customers off iOS 8's iCloud Drive | Computerworld
As with all new OS it wise to allow the dust to settle and bugs to be sorted out by someone else (preferably Apple and other developers) before committing to a process which may cause you more problems than it solves.

Thank you so much @chscag ! I went ahead and everything's still intact. I was so worried I was practically breakin a sweat. ��

And thanks for the heads up @RodSprague . I'll check out that link and do a little more research before I jump in ��