VMware backup fails with login failure

You should re-confirm all the requirements as per the following technote:

http://www.symantec.com/docs/TECH130255

Make sure that you are on at least SP3

Check to make sure the Backup Exec System Logon Account is logging on as Domain name\user name

also view the Windows event logs for the time the backup runs for event ID's of processes that my be causing the issue with the backup job

for more troubleshooting refer to http://www.symantec.com/docs/TECH129044