The process is not in background processing mode

When trying to download Software Updates in ConfigMgr it is possible that the following error message is displayed: "The process is not in background processing mode". When trying again the error message stays. Rebooting the ConfigMgr server doesn't help, so what to do next?

The solution is not that hard I think. It's BITS that's malfunction here! Just follow these steps to make it functional again:

• Logon to the ConfigMgr server (which in my case is also the WSUS server)
• Stop the Background Intelligent Transfer Service (BITS) service
• Stop the Windows Update (WUAUSERV) service
• Browse to the "Documents and Settings\All Users\Application Data\Microsoft\Network\Downloader" folder and delete both files in here (qmgr0.dat and qmgr1.dat)

On Windows Server 2008 (R2) servers it's needed to give Everyone NTFS permissions to browse that folders. This because Everyone is by default on the deny list here.

• Browse to the "C:\Windows" directory and delete the SoftwareDistribution folder in here

The SoftwareDistribution folder and qmgr0.dat/qmgr1.dat files will be created again after starting both services again.

• Start the Windows Update (WUAUSERV) service again
• Start the Background Intelligent Transfer Service (BITS) service again
• Open the ConfigMgr console and start a "site wide software update synchronization" by right clicking on Software Updates > Software Repository and choose: Run Synchronization

After that downloading Software Updates will be functional again!

Note: When it's still not working after these steps, have a look at possible changes in the Proxy server configuration. Especially Authentication settings can do the trick here!

Update 28-2-2013: When Microsoft or third party updates are still not download after above change, just try the following: Edit Anonymous Authentication for the IIS website (by right clicking) and change it from a Specific User to Application pool identity.
Thanks to Kapil Dham for the solution on this.