I have been successfully using my hotmail account on my Mac running Outlook 2011 for years - suddenly 3 weeks ago it stopped working giving me this message:

The server for account "Hotmail" returned the error "Authentication failure: unknown user name or bad password. [Error="ProxyNotAuthenticated" AuthResult=0 Proxy=HE1PR09MB0044.eurprd09.prod.outlook.com:1995:SSL].

My webmail and iPhone email are fine - I have changed the password on my webmail, tried re-entering on my Outlook and still no luck.

Have pop3 settings changed or am I missing something?  Help this is driving me crazy!