See if you can access the smtp server from the command prompt. You can run:
telnet <smptservername> 25
If you get something like:
220 mymailserver Microsoft ESMTP MAIL Service, Version: 6.0.2600.1106 ready at Fri,
6 Jan 2006 08:09:53 +0100
you're ok. If not, then the smtp server is not available and you need to get that fixed first.