Dear Nadeem
What specific command and all its parameters do you use to do the backup that now fails? Are you using LTO tape?
In the SAVXXX command, what device name do you use to do the backup? A tape library will appear to IBM i as both TAPMLBnn and TAPnn devices and in your case, you should use TAPnn device and leave TAPMLBnn varied off and never use it unless you have a need to control its library operation with IBM i commands or programmatically. I guess that using TAPMLBnn device would need the use of Media and Storage Extension in some way and cause its operation to fail when you do not have the license key of the product.

If you already use TAPnn device and it still fails, you should look in the job log of the job that fails to do the data backup to see what specific thing causes the data backup to fail.
If somehow you cannot apply the PTF suggested by Robert soon, another thing you can do is to try asking your local IBM to obtain the license key of the Media and Storage Extension for you as all IBM i V7.x customers are now eligible for it for free.
------------------------------
Chance favors only the prepared mind.
-- Louis Pasteur
------------------------------
Satid S.
------------------------------