A couple of days ago, I was testing with Veeam backup and a new created VM. The backup stops with the following error:
In the Veeam Backup release notes (veeam_backup_2.0.1_release_notes.pdf) and the known errors section, you’ll find the following text:
If you attempt to backup a VM with VMware Tools VSS support module installed with Veeam Backup job having VSS option enabled, the backup would fail with the following error: VCB error: Error: Other error encountered: Snapshot creation failed: Could not quiesce file system. An error occurred, cleaning up…. To resolve this, disable VMware Tools quiescence in the backup job properties, or uninstall VSS support module.
So I checked de VM and uninstalled the VSS option.
Go to Control Panel –> Add/Remove Programs –> VMware Tools. The VMware Tools Setup starts and in this screen press modify.
Disable the VSS Support feature in the VMware Tools.
Finish the setup wizard and reboot the VM.
After a reboot, the following error might popup:
The fix was a little bit funny. When I pressed the right mouse button on My Computer or any other directory, the Symantec Antivirus installer starts with a repair job.
After the repair job is done and the VM is back online after a reboot, the VM acts normal again :-S
ICT-Freak.nl 
To All,
After fiddling around with new clean install VM of the same OS. Now the following tricks working without uninstalling the VMWare tools support for VSS.
The reason why I’m doing this again is that I feel uncomfortable in removing the VSS snapshot provider support in VMWare tools:
1. Backup the following regkey: HKLM\Software\Microsoft\EventSystem\
2. Erase the regkey HKLM\Software\Microsoft\EventSystem\{26c409cc-ae86-11d1-b616-00805fc79216} an below
3. Reboot.
4. Verify that things are working by running
vssadmin list writers
vssadmin list providers.
and then in the services.msc list of services snap ins, make sure the following services are Started Automatically:
1. COM+ System Application
2. Distributed Transaction Coordinator
3. Volume Shadow Copy
4. VMware Physical Disk Helper Service
Automatically but not started:
1. Microsoft Software Shadow Copy Provider
2. VMware Snapshot Provider
now the backup is all working great 🙂
This is the solution that i tried around myself without uninstalling the VSS Provider support in VMWare tools.
See th following KB URL: http://kb.vmware.com/selfservice/microsites/search.do?cmd=displayKC&docType=kc&externalId=1009073&sliceId=1&docTypeID=DT_KB_1_1&dialogID=38752513&stateId=0%200%2038754922
Hope this can be a blessing for all of you.
Kind Regards,
Albert
Thank you for this, it appears to solve a similar issue at our site. We have been stumped on this.
What about Windows 2008 OS ?? as we dont have that reg key ?