This week's book giveaway is in the OCAJP 8 forum. We're giving away four copies of OCA Java SE 8 Programmer I Study Guide and have Edward Finegan & Robert Liguori on-line! See this thread for details.
Yes - you can use James which is an open source SMTP server. Better though is Dumbster which is intended as a test harness for programming with SMTP, so you can test that at least your code is working before having to deal with all the infrastructure issues.
Speaking of which, if there is a proxy between you and your SMTP server that could well be the problem, since proxy servers only tend to support HTTP. Check out the Java Mail FAQs for more detail.