TechnoKOZ

The new versions, 3.1 for the iPhone are fairly minor upgrades which on the surface seem to add compatibility features with the newly introduced iTunes 9.  The software update feature in iTunes that becomes available once you plug in your device.

Two major improvements in iPhone 3.1 OS update are:

1. Improved Exchange calendar syncing and invitation handling:  Fixes an issue where accepting an invitation on Outlook after it was pushed to the iPhone caused it to disappear from the iPhone’s calendar.
2. Wifi improvements:  There were many reported issues on many blog sites hinting on major issues with WIFI connectivity.  Visitors to our site as well as iPhone exchange sync customers are reporting that Wifi seems to be fixed in 3.1

Other iPhone 3.1 improvements:

iPhone 3.1 OS Update Major Gotcha!

iPhone OS 3.1 Breaks MS Exchange on Older iPhones.  Apple screwed up somewhere down the line with the original iPhone 2.0 & 3G Exchange ActiveSync.  These devices did not support hardware encryption.  With the new iPhone 3.1 OS, Apple now supports Exchange 2007 server option “Require Encryption on the Device”.   If this option is select on the Exchange 2007 server, your older iPhone will not connect to the Exchange 2007 server, without this option being turned off. 

Apple posted an official note :   Policy Requirement
The account “______________” requires encryption which is not supported on this iPhone

If you are running Exchange 2003, this policy requirement is not available.  However, if your organization uses Exchange 2007, you might want to concider upgrading to an iPhone 3GS phone.