After many searches of the ESRI Forums, finally found an answer. One little check box in internet tools LAN settings:Re: ArcGIS Connection has stopped working
The following suggestion should resolve the issue:
1. Open Internet Explorer-> Tools->Internet Options->Connections-> LAN Settings and turn off "Automatically detect settings."
Other Suggestions
1. Navigate to Control Panel->Add/Remove Programs->Select ArcGIS Explorer for Desktop ->Uninstall/change->Repair.
2. Try to ensure that you have the most current display driver installed on your client machine. Open Control Panel > Device Manager. Expand Display Adapters. Right click the adapter below this > Properties. Go to the Driver tab > Update Driver > Search Automatically. If you can upgrade, then install the newer driver.
3. http://cyri.systemrequirementslab.co..._if/1186/10895 Use ArcGIS Explorer behind a firewall: http://webhelp.esri.com/arcgisexplor...n/firewall.htm
Regards,
Robert LeClair
Esri-Denver Hope this helps anyone else stuck in the first exercise of the workbook...