According to Matt Gibbs, the 1.01 update to iPhone degrades the asynchronous features of Microsoft's AJAX library, specifically in its JSON serializer. Matt has provided instructions on how to fix this by altering the regular expressions used in the library.
ASP.NET AJAX is a bit of a misnomer. While it does provide libraries specific for ASP.NET, the client-side scripts were designed to be platform independent and is not tied to any specific web server technology. Released under the title Microsoft AJAX Library, these scripts are also used in PHP and ColdFusion sites.
According to Matt, the cause of the bug is a change to the regular expression engine included in iPhone's version of Safari. There is no word if this is a Safari bug per se and no blame is being placed on either party. The fix will also be included in the next version of ASP.NET AJAX.
