Failed to open the connection. Database Vendor code 4060

I recently had a problem deploying crystal reports to a server after an upgrade to crystal reports for visual studio 2010. When running the report from the web application I was getting the error 'Failed to open the connection. Database Vendor code 4060'

It dawned on me that is may be due to an issue similar to the 'double hop' problem where ReportViewer looses its impersonation context. This was easy to resolve by changing the application pool identity to a user that has access to the datasources and databases. Sure enough everything started to play nicely after the application pool was changed to match the user the web application was impersonating.

If you are interested in the ReportViewer double hop problem then here is the link:

Report Viewer Impersonation Context