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Why do I receive the error “This server version is not supported” when adding new SQL Server 2008 connections in Visual Studio 2008?

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Why do I receive the error “This server version is not supported” when adding new SQL Server 2008 connections in Visual Studio 2008?

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Since Visual Studio 2008 and 2005 were released before SQL Server 2008, their respective tools and data designers do not automatically support SQL Server 2008 and its new data types and features. To work with SQL Server 2008 in Visual Studio 2008 or use certain SQL Server features, Visual Studio 2008 Service Pack 1 and .NET Framework 3.5 Service Pack 1 are required.

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