I ran into this in a test lab environment and figured it would help to share. The View VMs in one of my test labs were hanging on the customization step, both linked clone VMs and full. I started troubleshooting and came across a couple pertient articles and really good ideas when this happens. The KB article on VMware’s site in regards to this problem highlights a few steps:
- Make sure the network is functioning between the desktops and the connection servers, DNS must resolve both ways and the required ports must be open. (see here)
- Verify that the template has been set up correctly (see here)
- Verify that the guest customization settings are correct and working. (see here)
None of these steps helped me fix the problem. The network was fine, the template was clean and was even pulled from a working environment and the guest customization was functioning and joining the machines to the domain with both quickprep and sysprep. Then I noticed the error that appeared when the customization timed out:
View Composer agent initialization state error (16): Failed to activate license (waited 1215 seconds)
So I flung that into google and found Terence Luk’s post about the specifics of this error message. The short version is chances are your VM’s install of Windows isn’t activated by whatever means. After reading through Terence’s article, I realized it must be a problem with the KMS server. I ran the command:
slmgr.vbs /dlv
from one of the machines and sure enough it wasn’t activated because there was no KMS server in my test domain.
Rather than standing up a separate KMS for my little test environment, I simply configured the base image to use use an existing KMS I have configured on the LAN by pointing my base image it to it.
slmgr.vbs /skms <IP address>
Then I ran an ATO to force KMS activation.
slmgr.vbs /ato
After running those commands pointed at a valid KMS server and taking another snapshot, the same templates and configuration spins up like a charm with both linked clones and full machines. Thanks to Terence for posting up originally!
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Added 8/23/2013
If you’re here and you’re looking to work around this error for your test lab, definitely check out this post, which goes over how to change a simple View agent reg-key that will bypass the license check.
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Added 12/2/2014
I also ran into a situation where deploying an unpatched Windows XP SP3 machine would fail due to inability to join the domain. Resolution is either get off that dog XP, install a MS patch or remove “Protect from Accidental Deletion” flag on the OU.
elgwhoppo's vNotebook 
Having read this I thought it was really enlightening.
I appreciate you aking the time and effort too put this article together.
I once again find myself spending a significant amount of time both reading and commenting.
But so what, it was still worth it!