This can be caused by any of the following reasons:
- You are trying to install "Reporting Extensions" on the incorrect server, you should be running the installer on the SQL Server not the CRM Server.
- SSRS is incorrectly configured, it is not configured or pointing to a Report Server database, a permisions or virtual directory issue. Try loading the Reports web page using IE to check that the Reporting URL can be reached.
- You have installed an unsupported version of SQL Server