The Snapshot creation fails with the following error:
CreateSnapshot failed, vmRef "vm-xxx", timeout "1800000", snName "VEEAM BACKUP TEMPORARY SNAPSHOT", snDescription "Please do not delete this snapshot. It is being used by Veeam Backup.", memory "False", quiesce "True" Cannot create a quiesced snapshot because the create snapshot operation exceeded the time limit for holding off I/O in the frozen virtual machine.
Within the vSphere Environment the following error can be seen in the task list for the VM:
Cannot create a quiesced snapshot because the snapshot operation exceeded the time limit for holding off I/O in the frozen virtual machine
This issue occurs when the I/O in the virtual machine is high and the quiescing operation is unable to flush all the data to disk, while further I/O is created.
This issue also occurs if you try to create a quiesced snapshot on a virtual machine that does not have free space. That is, if the free space on the virtual machine is 0 bytes.