I tried to install the new Service Pack for Team Foundation Server 2008 today. Not surprisingly, it failed. It failed for the same reason that it took me quite a number of days to get it installed in the first place, which is the integration with SQL Server Reporting Services (SSRS).
UPDATE (8/12/2008 2:00 PM EST): To resolve this problem, I logged into the SQL Server machine, and in the Resporting Services Configuration Tool, I exported the encryption keys, then on the TFS server, I imported the same encryption keys.
Microsoft, I really hope that you are listening. You cannot go anywhere with TFS while it has this wretched dependency on SSRS. My employer has lost about a week's worth of my time doing something that should have taken a few hours, because SSRS is such a steaming pile of manure. With all of the problems that I have had with TFS and SSRS, I promise that I will not be likely to build anything involving SSRS for a very long time, and I would not recommend that anyone have SSRS as a dependency for any product they ship. It simply does not work.
I really don't know what value SSRS brings to the table, but I doubt that it is substantially beter than, say, Crystal Reports. And Crystal Reports actually works. So does Cognos (I can't speak to the Cognos install process, just developing for it). The number of posts around the Web regarding the problems with TFS and SSRS are astounding. Even more frustrating, the most common error (error code 29112) has a huge number of potential resolutions, ranging from deleting the encrypted content in your database (sounds risky to me), to verifying that the SSRS installation was from the same SQL Server edition (Enterprise, Workgroup, etc.) as the actual SQL Server installation. It is pure madness.
I like TFS, a lot. I think that it is a really good product. But if you have any hopes of installing it, particularly in a dual server configuration (I didn't see SSRS problems on a single server install), set aside a lot of time for yourself, and don't plan on any particular project completion date. And stock up on tranquilizers so you don't rip your server out of the rack in frustration and burn it with a blowtorch.
J.Ja