KB980408 stops at 35% while installing, reports Install Failure and then reverts the Update and restarts. There are no install problem codes shown. Should I just ignore this Update? I don't even know exactly what it encompasses.
First, temporarily disable your security software and check if it installs.
Note: enable all security software once its installed.
If that does not work, you may want to look at is the DCOM settings. I'm assuming your system is Windows 7 thus the instructions are intended for Windows 7 and the kb article also supports that this is for Windows 7.
In addition to the DCOM settings I’ve included some general Windows Update troubleshooting for you as well. If you do not feel comfortable performing any of this troubleshooting (or) have questions please feel free to let the Community know.
Windows 7 DCOM Verification
1. Open a Run window and type: dcomcnfg
2. Expand 'Component Services'.
3. Expand 'Computers'.
4. Right Click on 'My Computer'.
5. Click on the 'Default Properties' tab.
a. Ensure that 'Enable Distributed COM on this computer' is checked.
b. Ensure that 'Default Authentication Level' is set to 'Connect'.
c. Ensure that 'Default Impersonation Level' is set to 'Identify'.
d. If changes were made click 'Apply'.
6. Now click on the 'COM Security' tab.
7. Under 'Access Permissions' click 'Edit Default'.
a. Ensure that Self, System, and Administrator have 'Local Access' set to 'Allow'.
b. Ensure that Self and Administrator have ‘Remote Access’ set to ‘Allow.
c. If any of these users are missing please add them.
d. If any of these settings are not checked please set them.
e. Make necessary changes, and click 'OK' to close this window.
After those settings have been verified/modified you can then run through some standard Windows Update troubleshooting. I’ve provided a basic set of instructions regarding Windows Update troubleshooting.
Click on 'fixit' from the below article which will automatically reset the Windows Updates components.