Integration between Reporting Services and SharePoint is achieved using an Add-in that is installed on the SharePoint side and configruing Reporting Services in SharePoint Integration mode. The diagram below shows this integration.
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You can look at the diagram and think that SharePoint and SQL Reporting Services are on seperate machines. You can run them both on one machine, in fact the installation process is almost identical. The one difference is that the machine that Reporting Services is installed on must have SharePoint installed on it and that installation be part of the farm.
The article covers the configuration in more detail, down to the document types and Report Builder integration. However, I've had a number of questions since the article was posted on the supported variations. So what is supported by what?
Well, with the release of SQL Server 2008 R2 and SharePoint Server 2010, there are now three versions of SQL, three versions of the SQL add-in, and two versions of SharePoint in market. The integration components can work on any of these releases, but you have to mix and match the right versions.
The table below explains the support combinations.
Report Server Installed | Add In Version Installed | SharePoint Version Installed | Integration Supported |
SQL Server 2008 R2 | SQL Server 2008 R2 | SharePoint 2010 Products | Yes |
SQL Server 2008 R2 | SQL Server 2008 SP2 | SharePoint 2007 Products | Yes |
SQL Server 2008 SP1 CU8 | SQL Server 2008 R2 | SharePoint 2010 Products | Yes |
SQL Server 2008 | SQL Server 2008 | SharePoint 2010 Products | No |
SQL Server 2008 | SQL Server 2008 | SharePoint 2007 Products | Yes |
SQL Server 2005 SP2 | SQL Server 2005 | SharePoint 2007 Products | Yes |

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