I think you will find this is the answer http://thunderbirdtweaks.blogspot.com.au/2016/06/hotmail-proxy-errors.html

Matt, thanks very much for posting the solution. I did actually figure it out after a number of days when I hadn't received a reply, although I didn't need to change the pop server. I thought I'd wait to see if the fix held before I posted it. When I logged into the outlook.com settings for my account I could see that POP had been disabled, and that an IMAP server was specified ie for incoming emails. Longer term, I think I will change my Thunderbird settings from POP to IMAP so that my 'live' account in Thunderbird is fully synchronized with that account on outlook ie the Microsoft web platform. But I figure I need to save a copy of my existing saved folders and contents in Thunderbird, so I don't lose them when synchronization occurs. That'll take a bit of time, so as a short term measure, I just turned POP back on in outlook. My recollection is that IMAP was not available when I started my 'live' account years ago ('live' was virtually the same as 'hotmail') ie before it was reconfigured as outlook. The error message you and I received is a Thunderbird message, and the thing that threw me initially was: how could my 'live' settings have changed without my doing it. I agree with you that Microsoft let users down by not notifying them that it had globally disabled POP in users' accounts. I'm sure you've explained it well which will help others. Mark