JSI Tip 9328. Windows Server 2003 Compatibility with Former Backup Software.

Microsoft Knowledge Base Article 327948 contains the following summary:

Windows Server 2003 contains a new backup infrastructure, including new Application Programming Interfaces (APIs) for backup. Windows Server 2003 also supports the backup APIs of Windows 2000. Because of the new APIs in Windows Server 2003, backup programs can use the new Volume Shadow Copy service (VSS). This service provides new backup functionality, including the following features:

It backs up files that are open for exclusive access.
It provides backups of volumes that reflect the state of those volumes at the instant the backup is started, even if the data changes while the backup is in progress. This feature makes sure that all the data in the backup is internally consistent and reflects the state of the volumes at a single point in time.
It notifies programs and services that a backup is about to occur, which allows them to prepare for the backup by cleaning up on-disk structures and by flushing caches and log files.

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