Team foundation : Area and iteration

I write this entry because I don't know the best way to use area and iteration in Team Foundation.


For the area, there is no problem, nearly everyone says that an area is a part of the project, a component for sample a project's areas into a project can be the UI, a webservice with sub areas.
There is an article on msdn blog about when to use Team project and area "When to use Team Projects"


For the iterations I have read 2 solutions, one is that each iteration is a version of project so V1.0, V1.1, ...

The other solution is that the iteration is analyze, development, test, demo, release, ...

I found an idea on this post "My 2 cents on Areas and Iterations in Team Foundation Server" to combine the 2 as this :

  \V 1.0
  \V 2.0


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