Report Builder 3.0 error : Connection Failed. Unable to connect to the server that is specified in the URL

Report Builder 3.0 error

"Connection failed.
Unable to connect to the server that is specified in the URL,'http://servername/Reports_SQLEXPRESS2008'.
Make sure the server is running, the URL is correct, and you have permission to use the server."

I saw other suggestions for fixing this error such as:

a) to make sure that the SQL Server Version is SQL Server 2008 R2 as Report Builder 3.0 does not support SQL Server 2008 or below.
or
b) to make sure you're not missing off the trailing slash in the URL, i.e. http://server/ReportingServices instead of http://server/ReportingServices/
or
c) even with SQL Server 2008 R2 - Report Builder 3.0 can't connect when supplied with the correct URL, even though you can successfully deploy from BIDS to the same URL.
etc.,

However, I found the cause can also be as simple as using the Report Manager URL, instead of the Web Service URL, in Report Builder's "Connect to Report Server" dialog box:

So, go into the Reporting Services Configuration Manager and make sure the URL you are typing into Report Builder is from the 'Report Server Web Service URLs' panel (see highlighted below):





and NOT from the Report Manager Site Identification URLs, as below:



Notice that TCP Port 80 is the default port and you will still be able to connect even if you leave out the default port number (:80) from the URL in Report Builder.