web service error: The request failed with HTTP status 401: Unauthorized.

I am doing the web service walk-through from here:http://msdn2.microsoft.com/library/87h5xz7x(en-us,vs.80).aspx

I get the error 'The request failed with HTTP status 401: Unauthorized'. My app is using windows authentication, I made sure the web service folder has permissions for everyone to execute and that didn't work. IIS has annonymous access checked.

I'm not sure what else to do.

Help?

Another thing... I'm using the integrated web server that comes with Visual Studio... does using it change things?

Hello.

I've faced that error when I tried to use async pages (at the time I thought that building a simple web service was the easiest way to test them). if i'm not mistaken, I started facing that kind of problems when I moved to beta 2 (pre-beta 2 releases worked without any problems). at that time i tried using IIS and the 1st attempts worked ok. However, at home I always got that error. never solved at home...really strange thing (in my case the exampl was really simple: the web service only had a single method which returned "hello word"). If anyone knows what wrong please let us know.

I get the same 401 failure under the same conditions. Some additional behaviors are that I can only get the web service discovery to work within the current project with the web service in the same directory. Web service discovery doesn't work for the localhost using a separate project under a different directory. I also have to include the port number in the namespace := "http://localhost:1363/" line for the 'follow link' to work.
The port number changes for each instance of the localhost webserver but seems to be hardcoded into the web service discovery files in the app_webreference folder.
I didn't change the proxy settings.

I mentioned in my previous post that I got the same 401 error.

I found that UNCHECKING the NTLM authentication checkbox in the website, start options dialog boxremoves the 401 error. I'm using Visual Studio Express, Beta 2.
When I go back and re-check the NTLM authentication checkbox, I get the same error or some other strange behavior such as the default.aspx page loads...( I suppose as part of the NTLM authentication process). I created a new page Call_HelloWorld_WebService.aspx that just calls the Hello_World web service as in the walkthrough. I start the Call_HelloWorld_WebService.aspx page using <ctrl><f5> and use the default web server that ships with VSE Beta 2.
SBR