Recently, we introduced several Windows Server 2012 machines into our network environment.  Everything worked like a charm *until* we performed a Windows update.

The Scenario

1. Hunt around looking for the “Start” hotspot
2. Click on Control Panel –> System and Security –> Windows Update
3. Click on Check for updates
4. A few moments later, we were presented with

Error(s) found: Code 80246003  WIndows update ran into a problem

The Environment

• A brand spanking new install of Windows Server 2012
• WSUS Role installed on Windows Server 2008R2
  (WSUS 3.0 SP2)
• Policy enforced Windows update via WSUS server
• Plain vanilla network and configuration

— Research Happens Here—

The Solution

1st: Update WSUS Server to support Server 2012 and Windows 8
Download and install KB2734608 onto your WSUS Server.
Follow this link for details and download: http://support.microsoft.com/kb/2734608 

2nd: Reset Windows Update on your Server 2012 install
On the Windows Server 2012 install, perform the following steps to reset Windows Update:

Step#1: Shut down Windows Update via the following command line command

net stop wuauserv

Step#2: Delete the Software Distribution directory [Yes, the entire directory!]

%windir%SoftwareDistribution

Step#3: Using regedit, delete the following Windows update registry entry

HKLMSoftwareMicrosoftWindowsCurrentVersionWindowsUpdate

Step#4: Relaunch Windows Update and check for updates!