Microsoft apparently isn’t going to ignore the iPhone completely. They’ve been hard at work, and now they have released Seadragon application for the iPhone today that lets users “infinitely zoom” on high quality images with high quality and near zero transition times. It’s available for free download right now.

We’ve covered Seadragon applications like TouchWall and pptPlex previously, and in March Microsoft built it into Silverlight.

You can browse a few photosets included in the application or add your own content from Photosynth or any RSS feed.

Hopefully this represents a trend from Microsoft that they will continue to develop for the iPhone, and release even more interesting applications over time.