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Hot-add trasport mode is a valuable solution for serveral environment, but is not necessary the fastest (see Slow speed in hot-add transport mode backup) or the best solution.

But for some environments (for example VMware vSAN) it’s the recommended approach.

But in VMware vSphere 6.5 and 6.7 that can be some issues using hot-add on proxy with a huge number of virtual disks.

Note that this issue is resolved in ESXi 6.5 P03 and ESXi 6.7 U1.

For a proxy VM that performs numerous disk hot-add, eventually the heap space can get exhausted. 

In this case the backup proxy goes to invalid state during backup.

And it’s not a Veeam issues, but a VMware related problem.

The VMware KB 56453 (Configuration file has unexpected changes and during backup proxy virtual machine terminates) describes the problem and give some solutions.

Of course the main solution is update to latest versions (ESXi 6.5 P03 and ESXi 6.7 U1) but there are also interesting workaround that can be used in similar cases.

The first option is to migrate the proxy VM periodically to clear up stale security policy rules.

Another options is to reload the proxy VM after it is migrated by running the following command in the ESXi shell:

vim-cmd vmsvc/reload <vmid>

Where, <vmid> is the managed object ID of the VM on the host, and can be obtained using the vim-cmd vmsvc/getallvms command