NTLM site reports an error in connecting Commerce Server Runtime database in CS2007 and MOSS 2007 Integration

Source: Microsoft Support

RAPID PUBLISHING ARTICLES PROVIDE INFORMATION DIRECTLY FROM WITHIN THE MICROSOFT SUPPORT ORGANIZATION. THE INFORMATION CONTAINED HEREIN IS CREATED IN RESPONSE TO EMERGING OR UNIQUE TOPICS, OR IS INTENDED SUPPLEMENT OTHER KNOWLEDGE BASE INFORMATION.

An NTLM site may get the error, "Login failed for user 'NT AUTHORITY\ANONYMOUS LOGON'" when the site starts and tries to connect to the Commerce site runtime databases after the installation of the MOSS2007 Hotfix 951695 (http://support.microsoft.com/kb/951695/en-us) or the MOSS 2007 update which includes this Hotfix, and the MOSS site is using the Commerce Server 2007 modules.

ASP.NET impersonation is required for SPS site after installtion of MOSS2007 hotfix 951695 or later update including it. Because of that, if the NTLM site is using Commerce Server 2007 modules and windows authentication in Commerce runtime Databases connection strings, the NTLM site may fail at connecting to Commerce Server runtime databases with error:

Login failed for user 'NT AUTHORITY\ANONYMOUS LOGON'

Two solutions:

• Use SQL authentication in every Commerce Server 2007 Database connection string.
• Enable Kerberos for SQL server that hosts Commerce Server 2007 databases. See KB 909801 (http://support.microsoft.com/kb/909801/en-us) for how to enable Kerberos for SQL server 2005.

One of the above resolutions can resolve the error.