Server 2003 Telnet check for SMTP failing

I am using the instructions here (http://support.microsoft.com/kb/323350) to check my IIS smtp virtual server.

When I put in the open 25 command it goes to a “press any key to continue” message and then after pressing a key says “connection to host lost”.

I would appreciate any help in determining where things are wrong in my smtp setup.

As of right now the SMTP virtual server will send emails to the local domain but will not send them to addresses outside of the local domain.

Thanks