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Why is firefox set to use proxy setting

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I recently had a problem with a program not being able to connect to the internet because firefox was set to use system proxy settings. To fix the problem I changed the connection settings to "No Proxy". What are the system proxy settings and why is firefox set to use them? The computer works just fine using "no proxy". Would there be a problem with this setting?

I recently had a problem with a program not being able to connect to the internet because firefox was set to use system proxy settings. To fix the problem I changed the connection settings to "No Proxy". What are the system proxy settings and why is firefox set to use them? The computer works just fine using "no proxy". Would there be a problem with this setting?

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No, there shouldn't be any problem. The "No proxy" setting is the recommended setting on the Windows XP platform as the default "Use the system proxy settings" usually doesn't work well on XP.

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OK I guess I'm a little confused. I have looked at other XP computers and the connection settings are all set to "Use the system proxy settings". If "No proxy" is the default setting is it possible there is a problem? What are the proxy settings for anyway?

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The proxy settings are used to set up the connection.
If the default "Use the system proxy settings" is working fine for you then leave it.
You only need to change that if Firefox isn't detecting the connection setting properly and you get server not found errors.