"Cannot perform a differential backup for database... ...Perform a full database backup..."

After installing SP2 on MSSQL 2005 you may get the folowing error:

"Cannot perform a differential backup for database "abc",
 because a current database backup does not exist.
 Perform a full database backup by reissuing BACKUP DATABASE,
 omitting the WITH DIFFERENTIAL option. [SQLSTATE 42000] (Error 3035)
 BACKUP DATABASE is terminating abnormally. [SQLSTATE 42000] (Error 3013)."

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Just set the SQL VSS Writer service to manual and restart SQL agent service: