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Instructions provided describe how to ensure that Microsoft SQL Server Native Client (SNaC) is installed on ArcGIS Desktop products.
Even when ArcGIS Desktop software has been successfully installed, there can be issues establishing a direct connection to an ArcSDE database or upon opening existing .mxd files or .pmf files where the data sources are broken.
One possibility for this behavior could be that the Microsoft SQL Server Native Client is not installed on the client machine(s) attempting to connect to an ArcSDE database, or open an existing .mxd or .pmf file using an ArcSDE direct connection.
Beginning with ArcGIS 10, the SQL Server Native Client 2008, a prerequisite to making direct connections to SQL Server, is installed with ArcGIS Desktop, ArcGIS Server, and ArcReader. This can optionally be installed with ArcGIS Engine.
What's new for geodatabases in ArcGIS 10
Depending on the options chosen during installation, the Microsoft SQL Server Native Client (SNaC) may not have been installed.
Please verify that the following steps have been completed.
Do not execute the setup.msi as this does not install any prerequisite checks.