Installing the Hyper-V RC0 update for Windows Server 2008 rendered my virtual machines unable to connect to the network.

I installed the hypervisor - Hyper-V RC0 build today.  After rebooting, my network configuration would not function.  I was unable to add an External network and bind it to the NIC successfully.

I'm running Windows Server 2008 RTM x64, and I had the beta (in-box) Hyper-V code running with virtual machines.  My physical machine has two onboard NICs; one was dedicated for the host, and the other was for the virtual machines.

So I removed the HyperV role, and rebooted the box.

The box hung like this, at 78%.  I power cycled it, which restored service.  The configuration was "resumed" and the role was successfully removed, with an error.  Unfortunately, the Virtual Switches stayed in Network Connections.  I then reattempted install of the Hyper-V role.  This completed, but with an error: it wasn't able to set up the networking components.

Note that http://support.microsoft.com/default.aspx/kb/950792 describes a hang at 75%, not 78%.  I also am not using HP NICs...

Log Name:      Microsoft-Windows-Hyper-V-Network-Admin
Source:        Microsoft-Windows-Hyper-V-Network
Event ID:      14070
Level:         Error
User:          SYSTEM
Description:
Switch set up failed, name='6d861a9b-39ef-4d01-a181-e163e5a21908', external port='f6400f7a-0dea-4b1f-bf91-3a78b00092f5', internal port='30b4be1c-5c03-48a6-84ed-7f590a3ffae7', NIC='{506E5818-0E27-4E13-8835-DDC8B7393D36}', internal name='9e3e1874-09ab-423b-904e-75420369499f', internal friendly name='New Virtual Network', error=2147749889, mof code=0.
Event Xml:
  <System>
    <Provider Name="Microsoft-Windows-Hyper-V-Network" Guid="{0a18ff18-5362-4739-9671-78023d747b70}" />
    <EventID>14070</EventID>
    <Version>0</Version>
    <Level>2</Level>
    <Task>0</Task>
    <Opcode>0</Opcode>
    <Keywords>0x8000000000000000</Keywords>
    <EventRecordID>88</EventRecordID>
    <Correlation />
    <Execution ProcessID="1088" ThreadID="1196" />
    <Channel>Microsoft-Windows-Hyper-V-Network-Admin</Channel>
    <Security UserID="S-1-5-18" />
  </System>
  <UserData>
      <Switch>6d861a9b-39ef-4d01-a181-e163e5a21908</Switch>
      <ExternalPortName>f6400f7a-0dea-4b1f-bf91-3a78b00092f5</ExternalPortName>
      <InternalPortName>30b4be1c-5c03-48a6-84ed-7f590a3ffae7</InternalPortName>
      <NIC>{506E5818-0E27-4E13-8835-DDC8B7393D36}</NIC>
      <InternalName>9e3e1874-09ab-423b-904e-75420369499f</InternalName>
      <InternalFriendlyName>New Virtual Network</InternalFriendlyName>
      <Error>2147749889</Error>
      <MofCode>0</MofCode>
    </NvspSwitchSetupError>
  </UserData>
</Event>

I've posted to some MSDN blogs' comments... but I doubt I'll hear back.

So now, I have no Hyper-V machines running anymore, and I can't get rid of the Virtual Network Switches.  I have heard from some people that manually removing the entries in the registry for the NICs will cause everything to "blow up".  I'm unable to delete the Virtual Switches in Network Connections, or in Device Manager.

My physical box has production workloads on it, so I can't blast it away.  Since the "finish line is in sight," I was kind of hoping that these kinds of things wouldn't happen, especially since they shipped the beta I was running inbox with the RTM code.

I can't find any evidence of Hyper-V on Connect, so there doesn't appear to be a way to report this.

Advice:

I would suggest that you remove not only the machines, but also the virtual networks, AND the Hyper-V role, before applying the update for Hyper-V RC0.  Then reinstall the role to make sure things are cleanly in place.

Solution: (Thanks to John Howard and Keith Mange)

"netcfg -u vms_pp"
Run ProcMon and set permissions on keys as necessary (Look for ACCESS_DENIED entries) to allow this to proceed.

After this process, I rebooted and found the Virtual Network Switch adapters were still present.

1. Click Start, click Run, type msinfo32.exe in the Open box, and then click OK.
2. Expand Components, expand Network, and then click Adapter. 
3. In the right pane, you see a list of items.
4. You can see entries for the Ethernet network adaptors. 
5. Find all adapters with the name "Microsoft Virtual Switch" and note the network adapter index number. Should be something like Name [00000009] Microsoft Virtual Network Switch Adapter
6. Locate the following registry key, and then change the following registry value to 0:
   HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Control\Class\{4D36E972-E325-11CE-BFC1-08002bE10318}\the false Ethernet network adaptor index number\Characteristics
7. Use device manager to “uninstall” the adapter.

In my case, step 7 hung - so I grabbed ProcMon and watched to see what key was causing the problem.

• 1095635 2:03:20.8945136 PM mmc.exe 2764 RegOpenKey HKLM\System\CurrentControlSet\Services\{B0E4253B-9A56-4D69-BA80-20FA4821CD5D}\Parameters\Tcpip ACCESS DENIED Desired Access: Read/Write, Delete
• 19 2:07:24.8307575 PM mmc.exe 2764 RegEnumKey HKLM\System\CurrentControlSet\Services\{B227EB3A-4453-4496-B378-D84FB0A46CFA}\Parameters SUCCESS Index: 0, Name: Tcpip
• 151188 2:11:59.6214689 PM mmc.exe 2764 RegOpenKey HKLM\System\CurrentControlSet\Services\{A17F68AB-654D-47C3-87CF-4ADFAC9C9239}\Parameters\Tcpip ACCESS DENIED Desired Access: Read/Write, Delete

Go into regedit, and set permissions on the Tcpip key so that the currently logged in user (Domain Admins, for my case) has full control.
Device manager should remove the key/adapter correctly.

Update (May 20th 2008):

Having Exchange 2007 SP1 on the physical host prevents Hyper-V from working on builds prior to RC1.  I have just installed Hyper-V RC1 today on my physical host and Hyper-V is now fully functional.  This was related to permissions in the registry at HKLM\system\currentcontrolset\services.

See also:

http://support.microsoft.com/kb/949222/ and http://support.microsoft.com/kb/949219

http://forums.microsoft.com/TechNet/ShowPost.aspx?PostID=3272554&SiteID=17

http://support.microsoft.com/kb/899868